Massive Gain in Online Shopping Sales During COVID-19

Massive Gain in Online Shopping Sales During COVID-19

COVID-19 pandemic has turned the world on its axis. Every area of life is influenced by the spread of the virus, particularly the finance and economic sector.

With the lockdown and social distancing, businesses are forced to close their doors while consumers go online for their daily essentials.

You would assume online shopping sales to rise, but the uncertainty around the situation influences consumer behavior, which impacts the online shopping trends. While some categories of e-commerce witness a rise in sales, others face losses.

That said, the blog highlights how changing shopping habits lead to a massive gain or loss of sales and traffic for in-store or online commerce.

Generational Responses to Online Shopping During COVID-19

COVID-19 has changed lives across the globe, impacting the young and old alike. But while the emotional devastation has been universal, responses to the changing trends have been entirely different for each generation.

When the spread of COVID-19 was declared a pandemic, most of the older generation also started panic buying, stocking up on daily life essentials before the lockdown. With time, there was a vast difference in the number of people shopping online and in-store.

According to Statista, in the USA, 34% of the Millennials were still shopping in-store in Feb 2020, whereas Gen X and Baby Boomers had switched to online channels. 

It led to an online traffic growth for e-commerce websites, particularly grocery stores and the general supermarket industry.

On the other hand,

calls Millennials the ‘worried’ generation because of their changing shopping behavior and spending habits more than any of Gen X or Baby Boomers, amid the pandemic.

Change in Men’s and Women’s Shopping Behaviors

Aside from the generational purchase responses, there is also a difference between the shopping behaviors of men and women. The survey revealing Millennials as the most impacted generation, also uncovers differences in men and women’s response to the crisis, with men showing a more significant change than women.

According to Forbes, 38% of men say that pandemic impacted their shopping habits, including where and how they spend. Nearly a third of the male population also claims a change in their spending decisions, such as what they spend on services and experiences like entertainment, restaurant meals, and more.

Similarly, men are shopping online more frequently than women, with an increased purchase of groceries, personal care items, healthcare products, and more.

Changes in Revenue Across the E-Commerce Market

With social distancing and the lockdown, in-store shopping has naturally declined, while online marketplaces are thriving. The changes in shopping behaviors also impact the revenue stream across the e-commerce market for some more than others. You can view some exciting e-commerce app design tricks on Designster that promote shopping.

Some of the e-commerce categories that have witnessed a rise in revenue include:

Grocery

With supermarkets and grocery stores shutting down, early March saw a rise in grocery e-commerce. Millennials and Baby Boomers all switched to online channels for their grocery supplies.

The convenience of on-demand grocery apps added to the rising revenue of grocery e-commerce. Walmart, Instacart, and Shipt had the highest app downloads since January 2020. Walmart, in particular, witnessed a 460% rise in the number of downloads.

Other eCommerce Categories

Besides grocery, other categories also experienced a rise in sales included medical, cleaning products, health & wellness, baby products, household essentials, electronics, and more.

Conversely, some e-commerce categories did not witness a positive change after the spread of coronavirus. With the lockdown and ban on travel, Fashion & Apparel, Jewelry, travel supplies, and auto products were least in demand during the pandemic.

Subscription Services

Sales in other areas of e-commerce also skyrocketed during COVID-19, including subscription providers and convenience services. Entertainment subscriptions like Netflix and Amazon Prime, for example, saw an increase in sales as people were forced to find ways to entertain themselves during the lockdown.

Product Categories During COVID-19

With uncertainty surrounding COVID-19, consumer behavior trends, and the resulting shopping habits change depending on the changing situation. That said, six behavior trends have evolved during the pandemic that influences online shopping. They are:

  • Health-minded buying – purchasing preventative healthcare products during the early stages.
  • Health management – shopping for protective gear such as masks and sanitizers.
  • Replenishing pantry supplies – purchasing grocery and other household essentials.
  • Quarantine preparations – panic buying leading to a shortage in stores and fewer store visits
  • Restrictions – fewer shopping trips, relying on online marketplaces and home deliveries
  • Getting used to the new normal – daily life resumes with a permanent change in shopping habits.

At each of these stages, people purchased different items, so thriving product categories continued to change throughout the COVID-19 pandemic. Some of them that were most affected include:

Food & Beverage

As we discussed, sales for groceries are the highest among all quarantine type items. But there is also a significant change in how people are shopping from the time before the pandemic.

Online channels provide several options for people to shop for their supplies without crowding supermarkets. They can choose to buy online and pick up in-store (BOPIS) or have it delivered to their homes.

On-demand delivery apps like Instacart and Shipt provide convenience. They allow consumers to hire people to prepare their carts, which they can then pick up in-store on the way or have it delivered.

The convenience of these delivery apps led to an increase in grocery orders by 124% for Shipt and 218% for Instacart. According to a survey by Shipbob, month-over-month data reveals an approximate 18.8% increase in sales for the food & beverage category.

Health & Safety

Throughout the pandemic, the one category that has witnessed empty shelves or price gouging is health & safety. From face masks to hand sanitizers, medical supplies, other healthcare products, and household supplies are running out online and offline far faster than they can be restocked.

A study from Nielsen states that sales for hygienic masks are up by 300% since the start of the pandemic.

Shelf-Stable Goods

In an attempt to decrease store visits, people are also turning to shelf-stable goods, particularly those preparing for long-term lockdown. As a result, products like shelf-stable milk and milk substitutes, as well as dried beans and fruit snacks are up by approximately 300%.

Digital Streaming

With cinemas, restaurants, and other public places closed down during the pandemic, it is not surprising that people have turned to the web for their entertainment. As a result, digital streaming services are on the rise.

Aside from traditional streaming sites like Netflix, Amazon, Disney+, and Hulu, non-popular channels such as movie studios are also experiencing an increase in subscribers. These media services are providing on-demand streaming of media, even before the expected release date.

Luxury Goods

Not all product categories are doing so well during the COVID-19 pandemic, however. Aside from travel and restaurants, the luxury goods industry is facing a decline in losses. A survey from Vogue Business identifies a loss of $10 billion for the industry.

It is in part because luxury brands like Versace and Michael Kors rely on Asian markets, where the pandemic has been influencing consumer habits since January 2020.

Fashion & Apparel

Other categories to face loss during COVID-19 are omnichannel sellers who are forced to close off their retail product line. With people avoiding in-store shopping for clothes and accessories, department stores and retail chains like Macy’s and Nike, respectively, are closing their physical stores.

Thus, not only the decline in online apparel sales but the loss of storefronts is also impacting the fashion and apparel category. According to a study by ShipBob, sales dropped at least 20%.

The Future of Online Shopping After COVID-19

The COVID-19 era is a time of flux, constantly changing with the situation. While consumers try to cope and adapt, their change in behavior influences the online shopping trends.

However, statistics suggest that the change brought forth by the pandemic will be the new normal. Businesses across the globe will need to adapt to meet the shift in shopping behavior, especially if they hope to continue ranking among the top companies on platforms like Clutch.

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