Impact of COVID-19 on E-Commerce Business

The Covid-19 pandemic has sent the world into a tizzy, with lockdowns, social distancing, and the constant fear of community spread of the disease. Businesses are functioning at reduced capacity – with minimal staff and fewer working hours. With only a small number of people being allowed to enter stores, people often have to spend a long time to buy groceries and other essentials, queuing up outside the stores. The coronavirus pandemic has changed life as we know it, and things that people took for granted all along have suddenly become adventures or sacred.

Covid-19 has impacted every single business in the world in some way or the other; as far as E- Commerce is concerned, the impact has largely been positive. Let’s examine the main reasons for this.

Fear of Getting out and Mingling with People

As I said earlier, a simple activity like going to a store has today become an adventure, and a chore – wear your mask, sanitize your hands, have your temperature taken at the entrance, sanitize all the items purchased once back home, wash hands again, put your clothes in the washer, and so on. In spite of taking these precautions, cases continue to increase in many parts of the world, and in some places, there is a second wave. This has scared a lot of people who now don’t want to take the risk of contracting the disease by being in a place where dozens of other people come as well. They prefer to stay at home and order online from Ecommerce stores; after all, from medicines to groceries to clothes, everything can be purchased online today. Businesses catering to essential needs have certainly seen a significant surge in online business. Most E-commerce stores have also urged shipping agents to initiate contactless deliveries for prepaid orders, by simply calling or messaging the receivers, and placing the package near the door. All of them have also adopted strict sanitization procedures, to ensure safety for themselves as well as the customers.

Discount Sales

With the pandemic resulting in salary cuts and even unemployment, many people have seen their financials take a hit. This meant not spending on unnecessary or luxury items. Clothing is both essential and a luxury, depending on the price and type of garment you look at. These businesses understood the importance of moving their products and put many items on sale – some at a heavy discount, tempting customers to purchase. Several e-commerce businesses who offered discounted products also enjoyed a good volume of sales.

Panic Buying

The younger generations especially is looking at the pandemic with a sense of fear and gloom, thinking the situation is far more grim than it actually is. This has caused many of them to stock up on goods, mainly essentials, but also some non-essential products, out of panic. This tendency of people to hoard or stock up products came as a kind of blessing for some ecommerce companies who made huge sales in the lockdown period and even after that.

Change in Spending Habits

The Covid-19 pandemic has forced a change of spending patterns –travel, dining out, picnics, long drives, movie nights, mall hangouts, parties, and such – all of this has come to a standstill. This means that the money that people would have spent on all these activities, is now diverted to online purchases. In fact, during the initial days of lockdown, it was the only ‘entertainment’ than many people had. Online shopping, and OTT services like Netflix, Amazon Prime Video, etc., also gained, as more people subscribed to their services. Though not strictly e-commerce as we know it, it is an online service provider.

So we can see that this pandemic has forced people to embrace Ecommerce more, in a bid to stay safe and maintain social distancing from people who could infect them. While grocery sellers are those who have benefitted the maximum, other online stores like fashion, footwear, sanitization, medical and healthcare products, subscription services, and so on, have also seen a 10 to 30% increase in their revenues.

However there is one setback that the Ecommerce industry has faced, and that is the uncertainty of the supply chain. This is because of the lockdowns and containment zone formations, and lack of permission to deliver in certain areas, or even to transport goods through certain areas. While this did not cause a cessation of services, it certainly made delivery slower than usual at times.

In spite of this, there is a clear shift in the spending pattern, as more and more people prefer to purchase online, as it is safer. We can conclude that on the whole, the pandemic situation has impacted Ecommerce in a positive manner, and has enhanced online sales. This could well be the way in the future, as there is tremendous uncertainty about the pandemic, and when it will subside.

Ergo, it makes good business sense for brick and mortar stores to create an online presence by getting an Ecommerce site, and catering to their customers, and get new ones too.

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