What is the impact of COVID 19 on E-commerce?

The costs of closing businesses, closing schools, closing football stadiums, and preventing any kind of cluster may not be bearable. The drop in the financial market may be worse than the 2008 crisis.

Although the virus does not have a high mortality rate (about 3.74%) the spread of the virus (between 1.6 and 2.4) is quite high compared to a normal flu (1.2) and the virus generates other very serious social and economic problems.

The infrastructure to provide medical care to all infected should they occur simultaneously may not be sufficient. The costs of closing businesses, closing schools, closing football stadiums, and preventing any kind of cluster may not be bearable. The drop in the financial market may be worse than the 2008 crisis.

What about the digital world? What will be the impact of COVID 19 on e-commerce and companies that sell online? Let’s find out…

1. General evolution of e-commerce

Note: The predictions made in the chart above do not take into account the pandemic generated by COVID 19. However, it is a fact that e-commerce is continually growing.

There are several reasons for e-commerce and online sales to grow every year: the number of people with internet access is constantly growing, there is increasing confidence in online buying and selling processes, and more offers are available online, among others. Overall, online sales tend to increase.

Still, the question we intend to answer remains… What will be the impact of COVID 19 on e-commerce?

1. The Chinese Example

In China, more than 40 hotels, cinemas and restaurants have “lent” labor to a company called HEMA, owned by Alibaba, to help deliver orders made online.

A cosmetics company called Lin Qingxuan closed 40% of the (physical) stores during the crisis generated by the virus but used a large part of the makeup artists and qualified people to influence the online audience with videos.

A video company called Kuaishou, which was valued at $28 billion, tried to make up for the lack of classes in schools and colleges by creating an offer in partnership with the Chinese education ministry.

55% of Chinese consumers admitted to using e-commerce platforms to buy supplies during this crisis. 600% was the increase in fresh food deliveries in China in 2020. Will the habits implemented in China remain in place after the crisis passes? We don’t know. Can we expect an increase in the use of social networks and in online sales? Clearly, yes.

There is no challenge without a crisis. Without challenges, life becomes a routine, in slow agony. There is no crisis without merit. It is a crisis that brings out the best in each of us. To speak of a crisis is to promote it, and not to speak of it is to exalt conformism.

There is talk of a new crisis worse than that of 2008. On this topic, I leave an excerpt from Einstein about the crisis:

“Let’s not pretend that things will change if we keep doing the same things. A crisis can be a real blessing to any person, to any nation. For all crises bring progress. Creativity is born from anguish. Just like the day is born form the dark night. It’s inventive in crisis that is born, as well as discoveries, and big strategies. He who overcomes crisis overcomes himself, without getting overcome. He who blames his failure to crises neglects his own talent, and is more respectful than to solutions to problems. The incompetence is the true crisis. The greatest inconvenience of people and nations is the laziness with which they attempt to find the solutions to their problems. There’s no challenge without a crisis. Without challenges, life becomes a routine, in slow agony. There’s no crisis without merits. It’s in the crisis where we can show the very best in us. Without a crisis, any wind becomes a tender touch. To speak about a crisis is to promote it. Not to speak about it is to exalt conformism. Let us work hard instead. Let us stop, once and for all, the menacing crisis that represents the tragedy of not being willing to overcome it.”

– Albert Einstein –

All trends point to the continuing growth of digital. COVID19 can cause a large downfall in the world economy and lead to one of the greatest crises ever felt by humanity, but it can also enhance innovative and creative digital solutions that may once have had difficulty in emerging.

What is the impact of COVID19 on e-commerce?  It’s positive. Maybe it’s the only positive impact of the virus. Let us believe, as Einstein believed, that this crisis will lead us to progress.