How Has COVID-19 Affected E-Commerce Businesses?

The COVID-19 pandemic has had a profound impact all around the world, not only from a business perspective but throughout our lives. There is still a lot of uncertainty surrounding when life can go back to normal and with that uncertainty comes a lack of business security. Companies of all sizes have felt the impact of COVID-19 on their organisations, with many being forced to furlough all of their staff or simply close.

At Siteminders, we have been working together with our clients to give them the best chance of succeeding or, in some cases, growing during the COVID-19 lockdown. This goal has led to a lot of sector-based research occurring within our team, with a particular focus on e-commerce.

The e-commerce industry is fairly new on the block compared to many of the industries we live with today and as a result, it has never undergone the stresses that a global pandemic can bring. In this analysis, we are going to cover everything you need to know about e-commerce during COVID-19, including the positives, negatives and how current e-commerce businesses can maintain growth and success.

What is E-Commerce?

To start with, we should talk about what e-commerce actually refers to. E-commerce is defined as:

Commercial transactions conducted electronically on the Internet.

This makes e-commerce a very broad term and in turn, a very broad industry. Any business that sells a product or service online can be classified as an e-commerce business, even if there is a physical shop attached to the same organisation.

The COVID-19 E-Commerce Acceleration and Opportunity

With country-wide lockdowns in place all across the world, physical shops have gone from decreased sales to no sales at all. With no profit to speak of, businesses running exclusively physical stores have been forced to decide between adapting and collapsing under the weight of the pandemic.

Simply put, more businesses are shifting to digital as currently, e-commerce is the only reliable way of generating income. Without digital sales, many of these organisations will be forced to close down and businesses who were previously sceptical and moving online are now being forced to. Overall, COVID-19 has accelerated the transition from physical to online business for many different companies in a variety of sectors.

With the closing of physical shops consumers have been forced to change their habits too. Many more people are going online to make their purchases because the internet is the only option available to them. This has opened the door for e-commerce businesses to see growth and success as their sales spike, only held back by their capacity to fulfil orders or provide the services they offer.

Which E-Commerce Businesses Are Growing?

There are particular e-commerce sectors which have seen immediate increases in sales. According to BigCommerce’s analysis of buyer behaviour, the Food, Gifts, Apparel, Games and Home and Garden industries have all seen marked increases in purchases. This makes sense as these sectors make up entertainment (a necessity through lockdown life) and everyday lifestyle items, apart from Gifts which can be considered a luxury, but one we feel obliged to indulge in.

One of the clearest patterns not just across these areas of e-commerce but across all industries, is the use of sales. Businesses are identifying the increase in online sales and strive to attract and lock-in these buyers through discounts, with BigCommerce identifying 73% of top retailers running sales during the lockdown period. This is unprecedented and reflects the fact that larger organisations, arguably more than smaller businesses, are desperately trying to maximise sales during this time of uncertainty and may even be feeling the pressure of the outbreak more than their smaller counterparts.

Which E-Commerce Businesses Are Struggling?

On the flip side, even with the surge of online users and consumers, there are some e-commerce sectors which have struggled more. Primarily, these are businesses selling products which people no longer require or cannot use during lockdown. Luggage and Gym Bags have both seen significant drops, alongside Swimwear and Cameras, all areas where you would expect to see decreased sales. Though Gym Equipment has remained prominent as people buy gear they can use to workout at home whilst the gyms are closed.

For these sectors and other businesses which are struggling to see growth due to their product range, it may be time to expand into what consumers are buying. Developing new supply chains and releasing products aligned with buying habits is essential if struggling e-commerce organisations want to survive.

How E-Commerce Businesses Can Capitalise on Changing Buying Habits

Alongside adapting their product range based on new buyer behaviours, the most important method for e-commerce businesses to come out of the COVD-19 epidemic in a position of strength is to develop their digital visibility. Large major retailers are currently moving online to survive and with their introduction comes greater competition for small and large e-commerce organisations alike.

In short, to survive, e-commerce businesses need to take advantage of their head-start and establish a strong online presence to maintain digital visibility. Investing in online marketing channels is the best first step to achieving this. Here are some of the most effective channels to begin optimising.

Search Engine Optimisation (SEO)

SEO is the bread and butter of modern-day digital marketing. It serves as the long-term goal and baseline of any digital strategy as search engines are the major method that users will find a business they want to purchase from.

To summarise briefly, SEO involves optimising a website so that it can be read easily by major search engines like Google. Through targeting relevant, high-volume keywords and amending web pages from a technical perspective, it’s possible to improve a website’s chances of appearing on the first page of Google or search engines like it.

Statistically, according to BrightEdge, 51% of all website traffic comes from organic searches like these, where users search a keyword and click on a website which appears. To put that into perspective, the next highest marketing channel is paid advertising, which generates only 10% of website traffic.

With that in mind, if an organisation doesn’t employ SEO strategies, they are potentially missing out on over half of the traffic they could generate. Additionally, they will likely have to pay for most of the traffic their website receives through other channels, reducing the profit made from any conversions or sales which do occur.

These statistics explain why SEO is the backbone of any modern e-commerce business’ digital marketing strategy, and why our Siteminders team place emphasis on its importance for all of our clients.

Social Media and Social Media Advertising

Social media has taken the world by storm over the last two decades, establishing itself as a major digital marketing channel which can no longer be ignored. The main benefit of social media is that it serves as a direct link between business and consumer, allowing a brand to develop a real and tangible relationship with its customers. This relationship builds trust and loyalty, two essential traits which could save a small business going through hardship during challenging times like those presented in the COVID-19 outbreak.

On top of this, social media provides opportunities for targeted advertising. Advertising on platforms like Facebook, Instagram, Twitter and LinkedIn allows organisations to filter the type of people they are advertising in previously impossible ways. Instead of television ads or billboards which opt for mass marketing, businesses can focus on specific sexes, age groups and demographics, even filtering their adverts to only be delivered to those with specific interests.

This granular targeting allows e-commerce organisations to only pay for adverts when they are delivered to those most likely to buy their product or service – an invaluable tool to create a stronger brand and improve digital visibility.

At Siteminders, we work with many of our clients to build social media followings and run targeted ads on their behalf. Whether it’s to generate brand exposure or specifically focus on sales and revenue, we have seen success across a host of different platforms and approaches, including for e-commerce websites and platforms.

Google Ads

Finally, we should mention Google Ads. As Google is the most widely used search engine in the world, its advertising platform is often a must for those looking at digital marketing.

Google Ads allows businesses to appear at the top of Google searches, even if their website wouldn’t naturally appear there. This is a great option for maintaining digital visibility whilst beginning search engine optimisation work which should, eventually, replace the need for paid ads.

Additionally, Google Ads has a specific offering tailored to traditional e-commerce businesses. Google Shopping Ads show an image of the product as well as its price and delivery information during relevant searches, which can hugely improve relevant traffic to an organisation’s website whilst increasing the likelihood that the user will convert into a sale, as they already know the product’s price and appearance.

At Siteminders, we advise our clients on which searches they should be targeting and work with them to set up Google Ads product feeds which are fully optimised for the best results. These feeds regularly see a strong return on investment and can make a difference for smaller e-commerce sites which lack the search engine presence to stay afloat with the increased competition sweeping the digital sphere.

Develop Your Business’ Online Visibility Today

If you are an e-commerce business looking to stay on your feet or simply generate more revenue during the COVID-19 pandemic, we can help. Our simple but effective digital marketing packages can be tailored to your business goals and needs, with local and national campaign options available. We shape our campaign and focuses based on your objectives, which is what helps us boost revenue and online visibility for all of our e-commerce clients.

Explore our packages today for more information or contact our dedicated team for bespoke advice and suggestions tailored to your business.

Sources:

https://www.bigcommerce.co.uk/blog/covid-19-ecommerce/

https://www.brightedge.com/resources/research-reports/content-optimization