Covid-19: Report finds crisis will result in a long-term boost for eCommerce

Online shopping will be significantly boosted in the long-term as a result of the Covid-19 crisis, new research from GlobalData has shown. The study found that many consumers, including those previously sceptical of eCommerce, will continue avoiding the high street in favour of online shopping even when lockdown restrictions are lifted.

The report, ‘Covid-19 Impact on eCommerce’, found that the impact will be most pronounced in the grocery sector, where online penetration is currently lower than the average across the retail industry. It noted that supermarkets were experiencing unprecedented demand for home delivery services during the crisis, with many struggling to meet demand, especially in the early stages.

Supermarkets including Tesco, Sainsbury’s and Morrisons have rapidly expanded their online delivery capacity in response to Covid-19, using a variety of methods.

Luke Gowland, thematic analyst at GlobalData, commented: “Covid-19 has given the eCommerce sector a boost, with online grocery retailers the biggest beneficiaries. Supermarkets are experiencing unprecedented demand for home grocery delivery. GlobalData expects the UK online food and grocery market to grow by nearly 20% in 2020 to £13.2 billion.”

The analysis suggests that even those areas of retail which have seen a drop in online sales during the crisis, eCommerce will be the key to recovery. This includes clothing, in which GlobalData forecasts a 7.9% reduction in UK online sales this year compared with 2019. Therefore, improving their eCommerce service should be a priority for all retailers right now, according to the authors.

Gowland added: “Companies will be focusing on their supply chains and how technologies such as the cloud, 5G, the internet of things, and blockchain can help to improve their efficiency and robustness. Ultimately, eCommerce will benefit from Covid-19 and even the worst effected companies will begin to build momentum once more once lockdown restrictions have been lifted.”

UK prime minister Boris Johnson announced last week that non-essential retailers may be able to begin opening their stores from next month.