With the COVID-19 pandemic escalating, isolation and social distancing have been put into place in many countries. Companies are providing more flexibility, allowing their employees to work from home, events are being cancelled or postponed, and travelling has become a challenge with countries closing their borders. The outbreak of novel coronavirus has already made an impact to the economy, and on consumer behavior.
The Rise of Social Distancing
As people began realising the seriousness of the situation, they started to avoid crowded places such as shopping centres and supermarkets. YouGov mentions in their March 2020 survey that 85% of internet users in China claimed to have avoided public places in the past two weeks. According to the same study, 27% of people in U.S. and around 14% in the UK, have taken the same action. A related data analysis mentions that 58% of Americans would consider staying at home and self-isolating if the outbreak worsens in their regions.
Avoiding shops and bulk buying products is having a real impact on eCommerce sales. Consumers have already started to change their buying habits, choosing online purchase options rather than the traditional walk to the store. This shift has been observed recently—in more festive times—during the last holiday season when US sales for online shopping rose by 2%-3%. Such a transition often influences consumer behavior longer-term, as individuals who get used to technology and ordering products online during a specific season or reason, are then more likely to continue this practice.
Changing Consumer Behavior
In this current COVID-19 pandemic, consumer demand (and patience) have also been altered. If the local store is sold out of certain items, people turn to online shopping. Some shops have resorted to placing restrictions on goods such as hand sanitizer, toilet paper or painkillers, allowing only 2 items per person. It takes time to refill store shelves, and with inventory limited in local stores, people are more likely to patiently deal with longer delivery windows and delivery fees related to digital shopping.
According to the Wall Street Journal, Amazon.com Inc. plans to hire 100,000 additional employees in the U.S. as millions of people turn to online shopping at an incredible pace. Amazon and other delivery-service providers are benefiting from the shift from traditional shopping to eCommerce. It has already been observed that nine out of ten keywords researched on Amazon were related to coronavirus.
Shifting to an Online Alternative
There is no doubt we will be experiencing many more changes in coming months. Social gatherings and events have already been postponed or delayed, stores welcome us with empty shelves and more and more people decide to stay at home to avoid public spaces. Shifting to an online alternative seems like a natural thing to do, and even demographic groups such as the elderly who lag in online shopping, seem to want to try it these days. Considering that they are more vulnerable to the COVID-19 virus, it seems like a sensible action.
Moreover, being stuck at home results not only in binge-watching TV series or devouring those unread books lingering on our shelves, but it also makes it easier for us to browse through online catalogues. Like the holiday shopper who gets accustomed to purchasing online, what impact will the coronavirus situation have on long-term online sales?
According to eMarketer, eCommerce sales are expected to fetch 12% of total retail sales volume in 2020. However, stock shortages, social distancing and the resulting changes in consumer behavior may significantly alter this projection.