How Has COVID 19 Impacted Online Retail? How Will E-Commerce React to the New Normal?

With physical stores closed, and the population of the UK confined to their homes, the last 3 months have had an extraordinary impact on online shopping, for both customers and retailers. 

As the UK enters a new period of lockdown, we thought we would take a look at which products have sold best, what the sticking points were for online sellers, and where the industry might find itself as lockdown eases. 

Industry experts have been watching the situation closely.  VISA, eBay and Google have all published reports showing how shopping behaviour has changed. 

Unsurprisingly, all three reports show dramatic changes both in the types of products searched for and in levels of purchasing. Research from VISA shows that a third of Brits purchased items online for the first-time during lockdown.  41% of those who answered the survey say they are shopping more online now than before. Many predict they will continue to do so, even those who previously preferred bricks and mortar stores.   But what were they buying? And why?

Early Weeks of Lockdown – Food, Home Schooling and Office Set Up

In the first weeks of lockdown, data insights from eBay and Google show a marked increase in food and other grocery purchases online, even searches for cat and dog food.

With pubs closed, online sales of beers, wines and spirits also soared.  Many restaurants adapted their websites to allow for online ordering of takeaway and recipe box providers struggled to cope with demand. People were even buying more freezers than normal, perhaps to store the food they had bought in a panic!

As soon as schools closed, searches grew for items to keep children entertained, including craft materials, books and games.  With people both working and schooling at home, office paper was almost as much in demand as toilet paper. 

Many of us were also improving our home offices, with new office chairs, printers and video conferencing headsets.

Cooped Up At Home – Fitness, Clothing and DIY Supplies

In late March, we started realising we needed to keep fit.  Joe Wicks began his daily PE lessons and the nation subsequently shopped for active wear, home gym equipment and fitness subscriptions. Cycling saw a huge increase, with bikes and accessory searches more than double their normal volume. 

DIY also saw a boost during lockdown. Searches for paint rose 825% year on year, and cordless drills were much in demand.

As the season changed, we realised we needed new clothes, but not the kind we might normally buy.  Retailers of office wear, such as Ted Baker and Hugo Boss really struggled.  Purveyors of relaxed clothing had more of a chance to make up for their stores being closed.  Gap reported a surge in sales through its website, up by 100% YOY in May. 

Top items purchased online during lockdown period:

  1. Groceries (bought online by 41% of those surveyed by VISA)
  2. Clothing and accessories (37%)
  3. Books, games and puzzles (31%)
  4. DIY supplies (21%)
  5. Electronics & hobby supplies (both 18%)

Easter Holidays and Sunshine – Time for Some Hedge and Hair Trimming!

As the sun came out, everyone lucky enough to have a garden was spending far more time in it than usual.  Searches rose for “barbecues”, “garden lighting” and even “fence panels”. 

Those few garden centres who were set up to sell online saw a boom in sales, with many swiftly updating their website functionality to quickly find a way to sell the plants they had ready for the new season.

Round about this time, we also realised that barbers and hairdressers would not be open for a while and eBay searches for “hair clippers” and “trimmers” shot up by 1,566%. “How to” home haircut videos were also pulling in millions of viewers, with varied results!

Lockdown Haircut

Challenges for Shoppers and Online Retailers – What Were the Sticking Points?

So, there has clearly been growth in many areas of e-commerce, but what challenges have retailers and customers faced along the way? According to VISA, these have included: being able to get a preferred delivery slot, being able to access click and collect services and getting hold of customer service teams, who are often working shorter hours.  Others reported problems accessing retailer’s websites, whether because the site had been overwhelmed (even sites as large as now have virtual queuing systems in place) or because the user, perhaps new to online shopping, found the site difficult to use.

Main issues faced by retailers and customers:

  1. Booking a preferred delivery slot
  2. Accessing click and collect services
  3. Accessing customer service teams
  4. Issues with websites being overwhelmed

Retailers have faced these issues head on, making fast fixes to website functionality and reorganising warehouses and distribution systems.  Next had to close its online store for a couple of weeks to put social distancing systems in place in its warehouse, and even then initially struggled to cope with the volume of orders coming through on re-opening. 

How Will E-Commerce React as Bricks and Mortar Stores Re-Open?

As lockdown eases and non-essential stores re-open, what do we expect to happen next for e-commerce?

The online sales boom does not look as if it will drop back any time soon.  VISA’s research shows that 74% of those who have been shopping online during lockdown, have found it works well for them and expect to continue to do so. 

To add to this, social distancing measures mean that “real life” shopping will be very different, at least for a while.  Those brave enough to venture out may well find the queuing and safety measures change the experience drastically, leaving online retail as the more attractive choice. 

Analysts expect to see a frenzy of Sale activity in the coming weeks.  Amazon has notified sellers that it will host a Summer Sale at the end of June, with a working title of the “Biggest Sale in the Sky”. 

The High Street is also gearing up for massive post-lockdown discounts. Fashion retailers have missed out on an entire season of sales and have around £15bn worth of stock to shift.  M & S, Next, Primark, Topshop, French Connection and Debenhams are all predicted to run “Rainbow Sales” and many are already offering heavy discounts through their online channels.   

The last few months have certainly been interesting times for e-commerce.  With all physical outlets closed, being able to pick, pack and despatch from warehouses direct to people’s homes has been a lifeline for businesses.  For customers, online shopping has had a huge role to play, keeping essential products flowing and enhancing life during lockdown.  Many businesses have found they are capable of being more agile and responsive to the changes required than they ever thought possible, ourselves included. 

We wish all our customers well during these challenging times and reassure you that we are here to help with any of your print and packaging needs.  We would love to hear from you, just get in touch.