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The Pandemic has Sparked an Ecommerce Boom – Will it Last?


Atul Bhakta, CEO of One World Express

The COVID-19 pandemic has undeniably changed both business strategy and consumer behaviour.

With the pandemic and its accompanying lockdowns forcing all non-essential retail outlets to close for much of the past year, much vital trading time has been lost. To combat this, businesses and customers alike have been driven to conduct the majority of their trading online; from retail products to manufacturing supplies. Consequently, the UK is in the midst of an eCommerce boom.

However, as the UK economy begins to reopen and lockdown restrictions begin to be eased, it’s interesting to consider whether the eCommerce will continue to gain momentum throughout 2021.

Changing behaviours

Recent data indicates that eCommerce is here to stay.

The Office for National Statistics’ report on the share of retail sales show that at its peak, in January 2021, the share of online retail as a proportion of total retail sales reached 36.3%. This is striking when compared with January 2019, where the figure stood at just 19.3% – nearly doubling its share in just two years.

Further, the recent IMRG Campgemini Online Retail Index report a 74% increase in UK online sales year-on-year for January 2021. It goes without saying that consumer behaviour has been influenced greatly by the lockdowns; the lack of ability to simply go to the shops has necessitated some level of embrace – however reluctant – of eCommerce by a broader portion of society.

Online retail has, of course, been steadily gaining pace on physical shops for many consecutive years, but this trend has been accelerated significantly by the reduced consumer choice of the past year.

The question, therefore, is whether this growth is sustainable, or a temporary and artificial spike predicated on necessity.

Post-pandemic preferences

A survey conducted by Retail Economics and NatWest reported that almost half (46%) of consumers in the UK have turned to online retail for purchases they would only have made in person prior to the pandemic. This tells us a lot about the intangible relationship between consumers and shops. Indeed, consumer preferences may be shifting away from visiting the high street, in favour of find the convenience of eCommerce.

The convenience factor provides tremendous staying power for this area of retail. Just a decade prior to the pandemic, online retail had a notorious perception of unreliability. Certainly, if the wrong goods are delivered and require returning, for example, the consumer will be at greater inconvenience than if they had taken a trip to the shops. However, thanks to advances in logistics, these complaints are increasingly a thing of the past.

We now have a robust delivery infrastructure capable of meeting the ever-increasing demand for eCommerce, and companies of all varieties can easily access web platforms that can manage numerous disparate services such as billing and shipping. On the shipping side, cheaper and more tailored delivery options, availability of live tracking, and seamless returns have underpinned the quality of service now on offer.

Further, most major online retail platforms make it easier for customers to make returns and get refunds than it ever was in physical retail, with robust and consistent consumer protection guarantees. In retail, trust is everything. Strides forward in the reliability of the service will hold firms who have pivoted to online retail in good stead for years to come.

Benefits for Businesses

eCommerce is obviously a boost to consumers, but also to be considered is the business case for eCommerce. In the past, well-located town and city centre commercial space was an expensive overhead, with rents and rates a challenge for even established businesses. Now, with consumers increasingly making purchases online, startups and multinationals alike could look to put eCommerce at the heart of their strategy.

There are, of course, limitations to how far eCommerce can go. The high street is a cornerstone of UK culture; entire towns are designed and built to flow through them. There will always be a place for brick and mortar. Many consumers will prefer the personal service and social experience of physical retail, which they trust through experience. Others will simply want to personally examine the quality of products before agreeing to purchase. It should be accepted that there are some bridges online retail cannot cross.

Clearly, eCommerce businesses cannot afford to be complacent. As such, they should examine how they can deliver a service to match these needs. Speaking to customers to understand how their service can be improved, for example, of consulting a logistical consultant to create the most efficient courier service would be a strong starting point. Such measures will go a long way in maintaining customer satisfaction and encouraging repeat business.

While there are limitations, and challenges from resurgent physical retail in the months ahead, it will be interesting to watch the sustainability of the eCommerce boom. Consumer trends are difficult to predict at the easiest of times, but the convenience of online retail can now boast will be important to remain competitive. Just as on the high street, it will all depend on the quality of service on offer. In that case, eCommerce businesses can look to the future with confidence.