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Coronavirus driving the E-commerce retail industry

Just imagine how fast E-Commerce retail industry is growing now. Due to the millions of Covid-19 cases across the globe, governments have implemented policies to encourage people to stay at home and maintain social distance, which has resulted in a massive E-Commerce boost.   

Particularly in the fashion industry, consumers tend to buy new clothes at home rather than visiting brick-and-mortar stores. Several large-scale retail companies such as Zara and Walmart have been investing loads of money on driving website traffic to increase customer demand. The global E-commerce website traffic skyrocketed in 2020 compared to 2019, with Zalando, VIP Shop and Farfetch being the top three fashion E-commerce platforms by traffic. This increased amount of traffic contributed to sales and growth in brand awareness [1].

Cost reduction is the main reason for companies to develop E-Commerce strategies during the Covid-19 period. Shifting towards E-commerce has saved companies money by digitalizing transactions, rent reduction, reducing paperwork and optimising inventory. By means of online transaction processing and electronic funds transfer systems, companies can simplify and speed up their business processes, making them more effective.

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The impact of Covid-19 on E-Commerce has not only reflected on sellers, but also the buyers. It is evident that customers from all age groups are more willing to purchase goods online [2]. Moreover, collectively, people over the world have spent more money with online retailers. The growth rate in retail E-Commerce sales was 36.7% for Latin America, 29.1% for Central & Eastern Europe, 26.4% for Asia-Pacific and 26.3% for Western Europe in 2019, referring to the figure below. Overall, the E-Commerce retail sales are predicted to have reached a total of USD$3.9 trillion globally in 2020 [3].

Key drivers are the personalised shopping experience online, the variety of products available, and the absence of shopping stress and time limitations. It is expected that the Covid-19 crisis will continue to drive E-Commerce in the retail industry.

“ We will continue to see a convergence of the digital and physical world. Those who conquer that trend will be market leaders. – John Phillips – Vice President, Customer Supply Chain for PepsiCo, Inc”

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[1] Elflein, J (2021). Statista: Market cap of leading fashion E-commerce companies worldwide as of September 2020.

[2] Group M Organisation (2020). GroupM sees E-commerce opportunities.

[3] EMarketer (2020). Retail E-Commerce Sales Growth Worldwide, by Region 2020.

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