The pandemic, despite being destructive and deadly, benefitted the ecommerce sector immensely. Here’s why this ecommerce boom was unprecedented in terms of scale and rapid adoption.
Ecommerce sales in the US and the rest of the world have surged since the beginning of the pandemic as more and more people transitioned to online shopping to stay safer and more isolated. The effect has spread to 2021 despite brick-and-mortar stores gradually opening up.
Emarketer forecasted the ecommerce retail sales to grow by 13.7%, up to $908 billion, in 2021. But that’s not it. Experts also estimate that ecommerce sales will rise beyond $1 trillion by 2022!
These figures are significantly higher compared to estimates forecasted before the pandemic arose. In fact, experts predicted ecommerce sales to hit a trillion by 2024, but the pandemic set things in fast motion in the ecommerce sector.
Adobe forecasted that global ecommerce sales would exceed $4.2 trillion this year, and the US will account for a quarter of these sales.
Considering these statistics, it is evident that the ecommerce industry is experiencing the highest spike in its history.
In this article, we discuss how the pandemic led to the unprecedented ecommerce boom of 2021 and how companies adapted to match customers’ increased demand.
Purpose-Driven Brands Take the Lead
The pandemic made many people aware of the frailty of human life despite our current technologies and advancements. That is probably why consumers started preferring companies that had a purpose.
Today, it is essential for customers that brands are environmentally conscious or focused on a social cause. The most prominent trend in this respect is being green and sustainable.
In May 2022, Stifel and Morning Consult surveyed US adults ranging from 18 to 55 in age and found that 71% of them care about a product’s sustainability more than they did last year.
In retail, sustainability could mean anything from using recycled materials and reusable packaging to opting for environment-friendly delivery options. Overall, the brands’ focus should be on lowering their carbon footprints.
Here are some ways brands are accomplishing this:
- Using Sustainably Sourced Materials: A prominent way in which brands are appealing to the public is by using recycled or sustainable materials. For instance, Crocs announced that it is aiming to become a 100% vegan brand soon. Meanwhile, West Elm Kids launched furniture and bedding that was made using reclaimed and recycled material.
- Reducing Carbon Footprint: Many companies are also working hard to make sure they lower their carbon footprints. For instance, Amazon is looking for ways to reduce its carbon footprint by rethinking the production and disposal processes. Meanwhile, many companies, such as makeup and beverages manufacturers, are putting carbon labels on their products.
- Using Reusable Containers: Retailers are also focusing on green packaging since plastic packaging has done substantial damage to the environment. Many brands have started using reusable packaging. For example, Dove has a stainless steel deodorant case that can be refilled to prevent packaging waste. Many other companies are also limiting or eliminating single-use plastic packaging from their products.
- Donating to Environmental Causes: Along with playing their own role in lowering carbon footprints, brands are also helping organizations that are already working for environmental causes. For example, many brands are giving a certain percentage of their sales to causes. Ethique, which is a vegan beauty brand, donates 20% of all its profits to nonprofit organizations.
Live Stream Shopping has Grown from 2020-2021
Another interesting ecommerce trend that has experienced an increase during the pandemic is live stream shopping. In fact, Forbes reports that the live streaming market will reach $11 billion by December 2021. It could also reach $25 billion by 2023, which means it is a market in itself.
While the US is still behind, China took up live stream shopping a while ago. In 2020, the sales from live stream shopping reached $150 billion, while they are expected to hit $300 billion by the end of 2021.
Nordstrom is one of the many brands that had live stream shopping across multiple categories, ranging from beauty and apparel to home.
The live stream had some named brands, such as Burberry, while the future events are expected to showcase Clinique and Tom Ford, among other brands.
The senior vice president at Nordstrom, Fanya Chandler, said in a Forbes article, ‘’“We are excited that Livestream shopping will give customers real-time access to Nordstrom employees and brand partners as well as experts in the beauty, fashion, and home categories.”
Grocery Ecommerce Growth in 2021
The pandemic and lockdown restrictions forced many people to shop for groceries from their homes, and it seems that shoppers warmed up to the idea.
In 2020, grocery sales grew by 54.0%, up to $95.82 billion. As a result, they made up 12% of all ecommerce sales in the US.
Although vaccinations have allowed people to step out of their homes for grocery shopping, it is expected that online grocery sales will still contribute a lot to overall ecommerce sales in the country.
Emarketer forecasts online grocery sales to account for 11.2% of total grocery sales in the US by 2023, a high increase from 7.4% in 2020.
Biggest Ecommerce Trends in 2021
Along with the aforementioned tactics, businesses also used a number of other methods to fuel this boom in ecommerce sales. Some of them are listed below:
- Offering multiple payment methods to customers
- Using artificial intelligence (AI) to learn about shopper behavior and market trends
- Using augmented reality (AR) to enhance the realness of online shopping for consumers
- Using chatbots to improve the online shopping experience
- Offering subscriptions, like Amazon Prime, to ensure customers keep coming back
- Being more sustainable and environment friendly
Big players, like Walmart and Amazon, have also dabbled in these trends to capitalize on this ecommerce boom. For example, Walmart’s new stores are experimenting with augmented reality to speed up the delivery of boxes from the backroom to sales floors.
Wrapping Things Up
Ecommerce retail sales are expected to make up a huge sum of the total sales globally and in the United States. Companies using conventional marketing and customer satisfaction techniques need to step up their game and incorporate new tech into their campaigns to stay competitive and relevant.
Additionally, customers are now more focused on brands that are environmentally and socially aware, which means such companies could see the highest returns or percentage increase in sales YoY during this ecommerce boom.
