It is difficult to predict how our world will change due to the global pandemic of COVID-19. There is no doubt that the world will never be the same as before.
Of course, I am worried about the situation, but I haven’t panicked because human nature has an exceptional ability to adapt to each situation. I am confident that this quality will see us through these difficult times.
In this post, I would like to reflect on the very visible impact the virus is having on the e-commerce industry and the implications for people and businesses today.
Adapting to the new reality
First of all, due to quarantine restrictions, most people have now become confined to their homes and their movements limited by government-mandated guidelines. Most physical shops have been closed and the only open merchants, such as grocery stores, are required to operate with strict limits on the number of people allowed to enter their establishments.
After the initial shock people quickly adapted to the new reality, either by limiting their consumption or moving their purchases online. Shopping online for most consumer products in many cases became the only option. A lot of consumers were logging in for the first time out of necessity and many late adopters found it surprisingly easy to function in this new virtual world.
It goes without saying that businesses dealing in consumer products have been significantly affected. In an instant, most shops had to close their doors to help in the fight to limit the spread of the virus. Those that remained open were required to limit the number of customers significantly, new protection measures had to be installed, and opening hours adjusted, all having a huge impact on revenue and profits.
Some of the businesses with an online presence that were impacted hardest by the restrictions were able to mitigate some of the effects of their closures because they could still operate online. In some cases, they are performing better than before.
Of course, it is industry-dependent, but there are still many businesses that do not offer food-related products and have been able to produce acceptable revenue, while many without an online presence have seen their revenue drop to zero.
Increasing number of e-commerce inquires
Here at Xfive, we have already received numerous inquiries concerning e-commerce development. Within the last month, we have fielded twice as many e-commerce questions as compared to the same period last year. Which industries do these questions originate from? From all of them.
From big brands to a small local metal artisan business, they all have one thing in common, they have no online presence at all. This has serious implications for their businesses as they are not able to adapt to a completely new playing field.
Some of them are attempting to adjust to the new situation and are implementing emergency half measures to market their goods. Often these solutions include taking orders via phone or installing simple contact forms on landing pages.
They know these are only temporary workarounds that will ultimately require a professional long-term solution to maintain their businesses.
The other client type falls within the fortunate group that has an online presence. These businesses have websites, maybe even an online store, but never created them with the expectation it would be their main storefront.
These webpages weren’t a part of a wider or focused strategy, but more of a bonus to their physical stores. Furthermore, they were not designed or optimized to generate a regular source of income for them. Suddenly, in the current crisis, their websites require a complete overhaul since their business models require an immediate adjustment.
In addition, they have discovered their websites are a great avenue for conducting and expanding their business. However, they have been using low-cost solutions that were not properly implemented and did not sufficiently support the unanticipated volume or scale of commerce they started to receive.
The future trends
The primary question now is what can we learn from this? Will this trend continue after the pandemic subsides? Will customers use e-commerce less frequently after the crisis? Or has the new e-commerce era started?
My personal thoughts are closer to the second option. I am almost certain that we will be buying more goods online than before the pandemic began.
First of all, a lot of consumers have just discovered the convenience of shopping online. You can buy everything you need in life quickly and easily from the comfort of your home.
Of course, there are still some products that we will perceive as easier to purchase in-person. Let’s take a look at the example of footwear. A few years ago most of us could not imagine buying shoes online.
Today it has become a very common practice and an increasing number of consumers find purchasing apparel online the more convenient option. If something as particular as shoe purchases can work online, why not utilize it for your daily shopping habits in other areas as well?
Secondly, businesses have found that having an e-commerce solution is a safety net in unpredictable times. Looking at the current Covid-19 situation, businesses are beginning to consider solutions that will protect their revenue streams today and in the future.
It is much like a Business Continuity Plan for them and must be considered by all businesses for survival in the long term.
Additionally, products and business services that were previously undervalued or undersold are seeing improvements in an online format. The crisis brought on by the pandemic has shown them that these parts of their businesses can be a valuable addition to their revenue.
With the rapid growth of e-commerce services and the expanded needs of delivery services during the pandemic have shown that they can easily scale and deliver goods even faster than before. A similar phenomenon has occurred with the payment processors which have improved and expanded due to the crisis.
Considering all factors, it is the right time to make a serious and long-term investment in e-commerce.