Since the coronavirus pandemic began this year, there have been 13 straight weeks where more than 1 million people have filed for unemployment for the first time in the US, according to the recent article from the Washington Post. Analysts said the weekly numbers point to steep challenges the country faces in its recovery. For most people looking for a way out, one of the tips on how to survive the coronavirus pandemic has to be identification of opportunities available despite the current headwinds. Unsurprisingly, the online retail market has offered a silver lining in this dark cloud.
The pandemic has driven a significant acceleration in online grocery sales. In the US, in sharp contrast to the overall U.S. retail market results ending Q1, down 2.9% for the 13 weeks ending May 2, there was solid performance by Walmart driven by grocery, essential goods and strong digital commerce. According to a Forbes report, Walmart’s net sales increased by 10.5%, with e-commerce sales up 74% as stated in the investor call on 18th May, 2020.
“Despite a tumultuous Q1 for many companies, the coronavirus created a huge opportunity for Walmart to capture market share,” said Kunal Chopra, CEO of etailz.
Across the Atlantic, in the UK, the BBC also reported, this month, that London-based courier business Gophr had just seen its busiest ever two months as more people got a taste for online shopping. Global retail sales generated through E-commerce saw a drastic surge as consumers turned to online and mobile shopping to buy groceries, daily necessities, and other products.
In the meantime, British online supermarket Ocado plans to raise over 1 billion ($1.3 billion) in capital, enhancing its online delivery services as people in the UK continue to shop more from the comfort of their homes. In a yet another June article, the Business Insider reported that the chain stated that the coronavirus pandemic had driven a significant acceleration in online grocery sales which had made way for a “permanent redrawing” of the global grocery industry.
47% of existing online shoppers in Europe have increased their online grocery purchases since COVID-19 and are expected to continue, Ocado was reportedly to have said, citing data compiled over four weeks to May 16 by analytics firm Nielsen.
The group said UK online market penetration had reached 9% in May 2020, compared to just 7% last year before the coronavirus struck. The grocery chain already has a bunch of licensing deals with nine partners including US supermarket giant Kroger, Japan retailer Aeon, Australia’s second-largest grocery Coles, Groupe Casino in France, and Sobeys in Canada. In May, the chain said its retail sales were up 40.4% in its second quarter compared to the previous year.
While there was significantly positive news in the online retail front, some segments, including travel and airlines, experienced a severe downturn due to COVID-19 in both online and offline channels. Online travel agencies such as Booking Holdings, Expedia Group, and Airbnb saw weekly accommodation bookings plummet by over -90% during April 2020.
Digital and contactless payment methods rise amid the COVID-19 outbreak
The coronavirus outbreak is not only transforming the way consumers shop but also how they pay for their purchases. Contactless payments received an unprecedented boost during the pandemic, seen by consumers as a cleaner way to pay in-store. Consumers are also trying out new payment methods while purchasing from E-commerce websites, and favour those methods that have the strongest protection against fraud losses.
The momentum for online retail sales may not be sustained at the current levels as a new study, just released by Chain Store Age, contains some good news for brick-and-mortar retailers.
According to a survey of more than 18,000 consumers from shopping rewards app Shopkick, about three-quarters (73%) of respondents say they feel equally or less concerned about COVID-19 than in May. And in a May Shopkick survey, 82% of respondents said the pandemic was affecting how they shop and now that statistic has dropped to 70%.
Looking ahead, the survey found that although 48% of respondents say they are shopping online more frequently than one month prior, 65% still plan to make most of their summer purchases in-store. Consumers say they plan to spend most of their summer shopping budget on groceries (41%), home improvement projects (27%), vacations (10%), recreation and outdoor activities (7%), clothing and apparel (6%), back-to-school preparations (4%), and summer camps (1%).