We are not going to belabor the obvious—2020 has been a challenge, and this is truer for retailers perhaps more than any other type of business.
Companies across all industries that once relied on their retail locations to drive purchases have watched as their foot traffic evaporated, leaving the future uncertain.
The silver lining that has become visible during this roller coaster of a year is an abundance of newfound ecommerce opportunities.
Consumers have turned to the only place they know they can find and purchase products and services with any certainty: the digital ecosystem. Brands of all sizes have been forced to embrace all that ecommerce has to offer, not only to weather the storm but also to set themselves up for greater success in the future.
The level of growth in ecommerce as businesses opened their digital doors has been nothing short of astounding. Let’s take a moment to break down this opportunity and why your business should be taking advantage of it right now!
1. There’s Been Record Growth in Online Purchases
In a recent webinar, we learned that in Q2 of 2020 there was more growth in ecommerce than the industry has seen in the last 10 years. Let that sink in. Between Q1 of 2013 and Q1 of 2019, the ecommerce purchase rate hovered between roughly 10% – 15%, with regular fluctuations throughout the year.
However, in 2020 this rate skyrocketed from 14.85% in Q1 to 44.45% in Q2! This means that in a single quarter—in just three short months—ecommerce purchase activity went up nearly 300%.
As retail locations of all kinds have been forced to close their doors (or at the very least impose limitations on hours and occupancy), the world has moved online—fast. If the percentages are scrambling your brain, let’s put some hard dollars behind those numbers.
In Q2 of 2019, ecommerce retail accounted for $138.96 billion in sales, in Q2 of 2020 that number has shifted to $200.72 billion. That’s a lot of billions that should not be ignored.
If you have been looking for a sign that you need to move business operations online, we can’t think of a better one than the record growth that is happening right now.
2. Digging Deeper Into the Ecommerce Shift
Since ecommerce was born, there has been a “chipping away” of the share of online purchasing vs. offline purchasing. Ecommerce purchasing gainsabout 1% a year. In 2014 ecommerce accounted for 8.9%, in 2015 the rate hit 9.9%, and this trend continued like clockwork—until 2020.
In 2019, ecommerce buying held about 14.7% of the market—that number has ballooned to 20.8% for 2020! This single jump is more than the past five years combined.
*It should be noted that these numbers also exclude those goods and services that are typically purchased offline, such as bars, restaurants, automotive dealers, etc.* So the year-over-year ecommerce growth may be higher.
One can infer that the majority of consumers are accepting that this pandemic is not going to “blow over” as quickly as many once thought, and they are settling into their new purchase activity. There is also the likelihood that, as the world returns to “normal,” these numbers are not going to suddenly “snap back” overnight, and a good portion of online purchasing will stay in place as part of many consumers’ new routine.
3. Brand Loyalty Is Evaporating
One thing that this influx of online purchasing has done is shed the light on other brands that consumers may have otherwise never known about, giving them new places to purchase what they need (and want). Consumers shopping online can compare pretty much anything, including pricing, delivery options, and overall availability. As supply chains get squeezed for certain items, consumers can turn to competitors to find what they need. In short, brand loyalty is not what it used to be.
While this may sound like a negative upfront, this change in brand loyalty can be leveraged into great opportunity for other brands (like yours) to attract new customers and pull market share back to their company, shifting more of their business and fulfillment online. Not to mention that by focusing on ecommerce, brands no longer need to stay local, they can now extend their reach far beyond their city, county, or state.
As early as April of 2020, 65% of US consumers (most of whom were sheltered in place) reported that they had tried products from new brands. Additionally, nearly 80% reported doing so because the product they usually purchased was out of stock.
Remember, with change comes opportunity, and with over 44% purchase growth and loyalty diminishing, this may be the best opportunity in history to shine a spotlight on your brand and attract customers online.
4. How Can You Take Advantage of This Ecommerce Wave?
Ecommerce website platforms and providers have taken notice as well and have been hard at work to make it easier for pretty much every brand to launch an ecommerce website.
While there are many options out there such as WooCommerce or Magento, one platform that ticks most of the boxes you need—from customization to relative simplicity—is Shopify.
At Shopify Reunite, Shopify’s annual event of sorts, the company dropped several new features and updates to satisfy the needs of a wider variety of business types. They even dropped a free Shopify theme called Express. It is a fairly simple “single-page” theme, but if your business is a local restaurant that just needs to provide a full menu for online orders, it might get the job done.
In short, getting your ecommerce store up and running used to be a fairly cumbersome process, but 2020 looks to have shifted ecommerce website providers’ plans into overdrive. So, if you are looking for a pretty effective, customizable solution right out of the gate, Shopify might be something to consider.
5. Simplifying and Scaling with Product Shopping Feeds Has Surged
If you have a larger volume and variety of products, such as clothing, spices, or even auto parts, a single page is not likely going to give you the flexibility you need. Not to mention, it will be far more profitable for you to not only have your own ecommerce website set up, but also to be featured on other sites like Amazon and Google Shopping. Dealing with multiple sites and wide-ranging product options means you are going to need something more robust regardless of the ecommerce platform you are using.
This is where using product and shopping data feeds may come in handy. Leveraging these feeds from a single platform will allow you to update listings across every site—at scale—saving you a ridiculous amount of time. Seeing as each online retailer (like Amazon) has their own set of listing requirements, feeds will let you edit and optimize faster without needing to log in to every platform and edit individual listings.
With this window of opportunity wide open, the last thing you want to do is spend the next six months “getting ready.” You want to use a solution that is customizable and agile enough to help you scale your business now—for the future and in the future. Using a product or shopping feed might just be your smartest play if you’re looking to take advantage of all the new-and-improved ecommerce possibilities and hit the ground running.
All We Can Focus On…Is Now
Just like you, we have a lot of questions about what business will look like over the next few months— or even years. We don’t have a crystal ball, but what we (and now you) do have is the data.
This once slow-but-steady upward trend of online purchasing has just shifted into fifth gear, and brands that don’t strap in for the ride are far more likely to be left behind. We can no longer wait for things to “go back to normal.” The likelihood is that this impact from the pandemic is going to have some staying power with regards to consumer behavior.
This uncertainty is stressful for all of us. Helping our clients pivot and keep the gears in motion has been both a challenge and an exercise in thinking strategically. If you need any help in upgrading and moving forward, you can contact our team anytime.