Understanding the COVID-19 Effect on Online Shopping Behavior

"BTP" (Before the Pandemic), South Africa's e-commerce growth was on a comfortable but sustained trajectory. Driven by a circumspect view of e-commerce from many Consumers, most Retailers saw an e-commerce platform as a nice to have, rather than a critical retail channel. Enter the Covid-19 lockdown and suddenly every Retailer was clambering to make use of their only viable retail channel, to try and stay afloat.

But with the move to lockdown level 3 and the reopening of most shops and malls, it will soon be business as usual, or will it? The world has changed irreversibly, and along with it Consumer behavior. The lockdown forced wary Consumers to use e-commerce platforms and in so doing drastically altered the trajectory of e-commerce in South Africa. Consumers, young and old alike, are now embracing e-commerce platforms enjoying the ease at which they can access cost effective products and the bliss of free delivery. An International survey, showed that on average, Consumers were spending between 10% to 30% more online. Further studies showed a significant shift in the type of items being purchased, with Consumers purchasing more groceries, consumables and non luxury items. For retailers this means the traditional barriers between the kind of products you buy online and those you go to the shop for, are breaking down.

So can we go back?

Consumer behavior is impossible to predict with certainty, but what science will tell you is that if you change someone's behaviour for long enough, it will become the new norm. The 2 month lockdown may not have been "long enough", but if the projected Covid-19 infection and mortality rates in South Africa are even partially true, Consumers, certainly those who are likely to purchase online, will start to self isolate, avoiding busy shopping complexes for all but the absolute essentials. If that proves true then we are likely to see Consumers buying online for the next 12 to 18 months, which will undoubtedly change their consumer behavior for good and could well see a mass exodus of Retailers to online platforms.

I am a Retailer and I don't have an e-commerce platform.

With the anticipated peak expected in July or August 2020, Consumers are likely to enjoy the freedom afforded by level 3 during the month of June and then revert to self isolation from July onwards as the curve steepens. At best Retailers have 2 months to gear up for this self imposed "lockdown". Developing an e-commerce platform can take time as Retailers are faced with an unfamiliar environment. Issues such as online marketing, stock management, integrations with accouting systems and most notably delivery, can pose significant challenges. Our recommendation is to find a partner who specialises in e-commerce platforms and who can help you navigate these challenges and implement an effective e-commerce solution in the reduced timeframes. All is not lost, but certainly things have changed, and Retailers are encouraged to embrace the unique opportunity to transition their businesses to an online environment offering reduced overheads and a substantially larger market.

 

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