E-commerce laggards will have a tough time recovering

Much of the coronavirus-driven increase in online shopping is structural, and retailers with strong omnichannel and e-commerce capabilities will be the ones that benefit from this.

Omnichannel capabilities can also direct shoppers to physical stores, benefiting local businesses as well as online retailers. Retailers that were lagging behind in digital transformation have suffered great losses and will be unlikely to see a full recovery when stores reopen.

Looking to the future, brands need to focus on their omnichannel strategy and accelerate digital transformation across their company in order to keep up with the shift in consumer buying behavior —
because it’s here to stay.

With more consumers shopping online than ever before, including those who had never previously shopped online, most brands have witnessed an unprecedented shift from offline to online sales in 2020.

Data from the Financial Times highlights that lockdown restrictions in Italy and Spain led to online sales almost doubling. In the U.S. online sales for Q2 increased by 44.5% year on year amid coronavirus lockdowns.

Our data suggested a dramatic shift to online retailers. We witnessed exponential growth in online sales across all industries. Website traffic doubled in the health care and pharmaceutical sectors, while conversions grew by 300% from March-April. The toys and games sector saw a massive 20x increase in sales during the lockdown, compared to the start of the year.

Later in the year, after lockdown measures were eased, some countries returned to normal, but the shift to online retailers continued. It is not yet clear whether this signals a lasting change in consumer buying behavior, or that online shopping is still driven by a fear of infections.

During the lockdowns, large consumer groups were newly exposed to e-commerce and its convenience, and the pandemic accelerated a digital transformation trend that was already happening. According to an IBM report, the COVID-19 pandemic has accelerated the shift to e-commerce by five years.