Coronavirus outbreak has already heavily affected all of our lives, and it’s difficult to predict what still awaits us during the coming month. But there are two things we can say for sure: online businesses are coping better than all other industries and e-commerce as we know it will transform during this time.

Impact on e-commerce

Why online business and specifically e-commerce will change. It already happened once, just on a less scale. The SARS epidemic of 2003 had a huge influence on e-commerce development and digital shopping growth in China. Back then people were afraid to go outside, and the founder of JD.com, currently one of China’s largest online retailers, moved his physical stores online and this changed Chinese consumption patterns forever.  Now we can expect a new change in how people shop online worldwide.

As there is not enough data on how demand in e-commerce changed in the US since the coronavirus stroke, we can look for some insights in other countries that started to cope with the consequences of epidemic earlier.

According to a study by Ipsos MORI from mid-March 2020, 50% of Chinese and 31% of Italian consumers stated they use e-commerce ‘more frequently’.  Online sales in Italy between February 2020 and March 2020 grew significantly due to the coronavirus pandemic. On March 8, online sales registered a 90% increase compared to the same period in 2019.

The first sales data in the US show a huge increase in grocery-related e-commerce but few changes in the rest of e-commerce, with the retailers of non-essential and luxury goods suffering the most. Rakuten Intelligence study shows the change from the same period in 2019:

The data collected by Сommon Thread Co from several accounts show a more optimistic picture for e-commerce businesses. Online revenue got an increase of 56.53% and shoppers’ spending grew by 19.20%.

Online best sellers

As the COVID-19 pandemic hit China first, we can use their sales data to find out what to expect in the US. Of course, the winners were companies providing for sanitary needs. According to data provided by Statista, after the coronavirus COVID-19 outbreak in China, people increased consumption of such products in February:

The same industries are already experiencing tremendous spikes in e-sales worldwide. Also, a similar pattern among our clients too can be noticed. The traffic on edgeinsupply.com grew with the start of social distancing policies in the US.

In the first weeks of total lockdown, the most popular products Chinese shoppers bought online were groceries, hygiene products, beverages, and others. You can see what grew and what fell in the infographic below:

During the epidemic, people spent mostly on physical goods. Online sales of Home goods on JD.com jumped 470 %, with frozen food sales soaring by almost 800%. According to Fenqile, other large Chinese e-commerce retailers that sell kitchen products have registered strong sales too because people started to cook more at home as they couldn’t go to restaurants. Orders of high-speed blenders and electric grills have seen a month-on-month increase of 40% and 55%, respectively. On the Pinduoduo, egg poachers were the “best selling products” between Jan 24 and Feb 14, the first weeks of quarantine. According to information from Taobao, one Chinese brand has sold thousands of self-heating hotpots in 10 minutes of a live broadcast.

Electronics retailers were next, experiencing growth as people started to organize their homes for distant working and studying. Laptop sales increased by 50% from the same period last month on Fenqile. Computer-related products, such as earphones, keyboards, etc., raised by 30%-50% during the same period. Other work-related products like stationery and office furniture can also experience growth in the US, as companies implement working from home policies.

Statista conducts a daily COVID-19 pandemic survey, according to which people in China, Germany, United Kingdom, and the United States started to spend more on hygiene and household cleaning products, food and drinks, home entertainment, and hobbies.

We can see spikes in traffic among our clients who sell products for hobbies and entertainment too. 

QuiltingMuse.com (quilting and sewing products)

And reduced traffic among clients who sell products that are not vitally needed.

Marjorie & CO (Jewelry and accessories)

ut even the industries where online sales plummeted due to a drop off in customers’ confidence in spending money should not panic. According to Quantum Metric, e-commerce saw an average revenue weekly growth rate increase of 52% and an 8.8% increase in conversion rates compared to a year ago.

With the right action and strategy, you can keep your business successful during this pandemic. The hysteria-induced buying of groceries and essentials will soon stop, but people will remain locked in their houses and think twice before going out for quite some time yet. When the normal way of life returns, for people who are already on a certain standard of living, it may be difficult to break the habit and return to normal. So, as soon as shoppers turn the panic mode off and return to purchasing goods they need and want, they will rather stay at home and order for them online. 

The success for e-retailers during these times heavily depends on how rapidly business mobilizes to address current needs. It might be a change in the inventory, different marketing campaigns, enhancing website UX or something else. We’ll suggest our ideas in the next post.