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What are the long term effects of COVID-19 on e-commerce?

The COVID-19 pandemic and the associated lockdowns have changed consumer shopping behaviour around the world. As a result, the e-commerce landscape has shifted over the past two years. In this article, we discuss four of the effects of COVID-19 on e-commerce. These are the effects that we are currently seeing and that are expected to last in the long term.

Flight to online

The most important and evident shift in the e-commerce landscape is the flight to online shopping. Experts say the pandemic accelerated the shift to online shopping by as much as five years. During the lockdowns, consumers were advised to stay at home as much as possible and there were even times when retailers had to close the doors of their brick-and-mortar stores. As a result, more and more consumers turned to online shopping. Two years ago, only 17.8% of sales were made from online purchases. That number is expected to reach 21% in 2022, a 17.9% increase in ecommerce market share over two years. Growth is expected to continue in the coming years.

The expectation that consumers will continue to shop online more and more is mainly due to the fact that consumers who have been driven to the internet for shopping during the COVID-19 pandemic, indicate that they like it and that they see the benefits of it. Research by Payvision shows this. More consumers have become convinced of the ease and speed of online shopping. In addition, more and more companies have introduced hybrid working, which means that employees work from home more often and can therefore receive packages more easily.

The shift to online shopping does not mean that brick-and-mortar stores are no longer in demand among consumers. More and more consumers are expected to use the brick-and-mortar store for the experience (fitting and touching the items), picking up orders and supporting the local economy. The shift provides opportunity for businesses that have not yet provided their customers with an online sales channel.

Mobile shopping and social commerce

The way consumers shop has also changed during the COVID-19 pandemic. For example, more and more consumers are now shopping via a mobile device, such as a smartphone or tablet, and via social media. When consumers started spending more time at home during the pandemic, they also started using social media more, providing an unexpected boost to engagement on these platforms. Here again, consumers have experienced the convenience and safety of shopping via social media and it is expected that they will fall back on this more often than before the pandemic.

Ethical and sustainable shopping

During the COVID-19 pandemic interest in ethical shopping and ethical brands rose by 450% according to Google, while a survey done by Accenture revealed that 45% of consumers are making more sustainable choices when shopping and report that they will likely continue to do so. This can be explained by the fact that the pandemic has made consumers think more about their health and that of loved ones, and the quality of their living environment. Moreover, sustainable logistics parties have been given more room to profile themselves in the e-commerce market. Due to the enormous pressure that the existing carriers had to deal with during the pandemic, more and more work became available for smaller parties that delivered sustainably. As a result, consumers have seen that the delivery of parcels can also be done in a sustainable way. Reducing the collective impact on the environment has thus become a major priority for online shoppers.

Less brand loyalty

The COVID-19 pandemic has resulted in a shattering of brand loyalty. During the pandemic, 75% of consumers tried new shopping behaviours, 36% of consumers tried a new product brand and 25% of consumers incorporated a new private-label brand. 73% of shoppers indicate that they continue to include new brands in their route. Supporting and discovering small entrepreneurs goes hand in hand with this. This development offers opportunities for smaller brands to increase their visibility among modern online shoppers.