Updated: Mar 4
When was the last time you visited an eCommerce store and thought of ordering hand sanitizers online? You could just walk outside your home and the local chemist gave you a wide variety to choose from (with different fragrances, colors & of course all that glitter )
It wasn’t just bought online, it even went out of stock in no time. Now, there is a high possibility that this form of alcohol will always be in demand even post the pandemic. According to a report from the business wire dated 11th March, the hand sanitizer market is looking at a CAGR of almost 9% from 2020 till 2024. But these numbers must have significantly gone bullish in the past 2 weeks looking at the present scenario. The bottom line from this example is that the shift has happened. People who had never used this product previously have got used to it now, this is the effect of COVID-19.
This is exactly what’s happening with the global eCommerce market. The section of the human race which predominantly depended on the offline channel is preferring the online channel now. It’s probably not out of choice but due to the present restrictions related to social distancing. But will they go back to purchasing everything offline? Some of them would. For the rest, the shift has happened. Convenience is an addictive attribute when it comes to routine purchases. Sooner this habit will lead to purchasing non-essentials online too. This is exactly what happened when the 2016 Indian banknote demonetization happened. The country had to shift completely to the digital payments option. This was more by force than out of choice. But look what happened, the country is inclined towards digital payments even after the cash currency transactions were restored to normalcy.
Nike was the fastest to adapt to the digital shift when the virus hit and damaged the offline business. They proved it by focusing more on the digital front at the epicenter of the pandemic i.e. China. Despite the fact that 80% of its physical stores are shut in the country, the brand eCommerce business has grown by 30%. Nike saw a massive rise in the usage of its activity app which resulted in higher digital sales.
A new study from Ipsos MORI from mid-March 2020 reveals that 50% of Chinese and 31% of Italian consumers say they’re now using eCommerce ‘more frequently’. In contrast, only 18% of UK respondents said that they were using online stores more frequently, with close to half reporting there was ‘no change’ in their eCommerce habits. However, now that the UK is in lockdown these statistics are likely to change dramatically, probably trending towards the figures seen in other countries with more advanced COVID-19 issues.
Going beyond statistics, it’s a no-brainer to guess the percent increase in mental bandwidth & new account acquisition social media has been able to achieve in the last few weeks. People are more likely to click on Facebook & Google ads than they did previously (Let’s not forget Tiktok). As the market is yet to reach even the start of its recovery, brands need to be vigilant on where their customer is moving. The online channel will most probably be as critical as the offline channel in the near future. Let us say even if it’s not going to be, the risk is too high to miss this bandwagon.