During the writing of this blog, the Coronavirus has claimed the lives of 51,434 people and infected around 1,002,071 others around the world.
The whole world has been shaken by this lethal monster. The economy and industries are no exception to the virus, facing massive blows as well.
While it’s obvious that the Coronavirus has affected our everyday life, we won't speak about the disease itself, rather, let’s talk about the Coronavirus’ impact on businesses; eCommerce businesses, to be exact.
At this time of crisis, you can answer one simple question to find out whether or not your business will be jeopardized by the Coronavirus. That question is:
“Is my (e-Commerce) business relevant to the world at this moment?”
To find out the deeper meaning and importance of this question, let's analyze the impact of the Coronavirus in many different industries around the Globe. Some industries are experiencing a serious decline, while others are growing.
Industries declining due to the Coronavirus
The coronavirus has created a negative impact on many industries, but the most vulnerable industries are:
- Real-estate industry
Day by day, there are more and more countries that are under nationwide lockdown, so you probably have already assumed that the travel industry is the most affected by the Coronavirus.
According to the World Travel and Tourism Council, the Coronavirus pandemic could cut 50 million jobs worldwide in this particular industry. Experts also predict over 15% of the decline in travel ad revenue. By the end of the second quarter of the year, this drop could increase up to 20%. Of course, that also depends on the duration of the Coronavirus outbreak and its scale.
In addition to this, e-Commerce websites that are closest to the travel industry and tied to the sale of products like suitcases, other packing accessories, or swimsuits, are also terribly hit.
The only ones that handled the situation well are those which conducted risk management before this crisis happened.
One of them is the Amerex Group. Here is an interview with their Director of Marketing and it is full of helpful information, you can check it out here. They have surely found an effective way to deal with the Coronavirus.
Be proactive, not reactive - our tip of the day!
Hotels, restaurants and cinemas
Hotels, restaurants and cinemas are also experiencing major setbacks. Day by day, they are losing more and more customers due to the reduction in tourism, the need to stay indoors for social distancing, and in some countries, due to the strict lockdown measures that are implemented.
However, some catering facilities in China have found a way to overcome the Coronavirus crisis. They are now sharing their employees among themselves using the first digital grocery supermarket called Hema. By using that software, which is, by the way, owned by Alibaba, they all together deliver their food to the customers.
There are many examples of restaurants and other companies that now lend their labor for delivery services.
In France, Spain and Italy, firms from this niche have found salvation in UberEats. In fact, UberEats' system is so overloaded that they logistically cannot fulfill all the demands, and they are currently hiring more people.
So, if you are in this industry, maybe an app could save your business.
Is the car dealer industry evolving soon?
We already mentioned that people and industries are affected, but what about the car dealer industry?
There is an interesting fact about it. The first car dealer industry in decline was in China (Honda sales dropped by 85%, Toyota by 70%), but along with spreading of the virus, the decline is also spreading across the world.
So far, until March 19 (2020), vehicle sales in the US could drop as much as 20%.
Selling cars over an eCommerce website? Why not - says Tesla Motors!
Wait, but what is interesting about it, and why is that related to e-Commerce?
Many facts indicate that the car dealer industry will refocus on e-Commerce sales. There are many challenges to handle, but it is still an opportunity, right?
Many e-commerce cosmetics stores have stopped working during this outbreak.
Most people are staying at home due to social distancing, so the demand for cosmetic products is very low at the moment.
Among the few who have continued to sell cosmetics over the internet is the Chinese company Lin Qingxuan. They focused their entire advertising budget on influencers. The results were outstanding as they achieved 200% growth compared to the same period in the previous year.
Our tip for cosmetics sellers: Use the power of influencers!
People don't buy luxury products these days, and that is just how it is. But, there are always bright examples, such as Les Petits Joueurs – e-Commerce for luxury bags and shoes.
This business, with an Italian producer behind it, is launching a full virtual showroom with AR (augmented reality) options for trying on every item in their shop.
You may not be able to build a system like this (Your maybe you can!), but it is the future of luxury e-commerce businesses.
Why are these industries most affected by the Coronavirus outbreak?
Let's get back to the beginning and the question we asked. If you don’t remember, the question was: “Is my (e-Commerce) business relevant to the world at this moment?”
So, are those businesses relevant to the world right now?
People today are terrified, in a state of shock, depressed or in panic. They are now isolated, their routines are disrupted, and they are trying to find a way to manage their time in that isolation. Many of them are being fired, or their businesses are down, so the purchasing power has never been lower. Almost all of them are in fear.
Everything we mentioned will bring us to the fact that people don't care about buying things they don`t need at this moment. They don't care about travelling, buying luxury products, cosmetics, fashion accessories, or anything similar. They only care about their essentials to survive this pandemic.
That is why your business should be relevant to the world at the moment! Try to refocus on something new, or work on building trust with your customers without spending too much money.
Now, let's go back to the industries that have grown due to this Coronavirus related crisis.
Industries growing due to Coronavirus
Fortunately, there are some industries that have growth during this crisis. These are:
- Book Industry
- e-grocery industry
- Home-gym equipment
- Healthcare (Pharma)
- Toys and Gaming industry (entertainment)
What about eBooks?
Is it true that people are reading more books, now when they are more in their homes? Yes, it is!
There are book lovers all over the world, there is no doubt in that. Now when they can't (or shouldn't) go to an actual store to buy something new to read, they start buying books online. But not regular paper books. People are now looking more for eBooks!
This trend probably hasn't been present at the very beginning of this crisis, but these days there is a noticeable increase in the number of eBooks ordered. Take a look at the graph below:
This is an opportunity to invest more in advertising books, isn't it?
As much as it seems to be happening on a huge scale, people around the world are not used to online shopping yet.
Yes, people do order stuff like clothes, eBooks, video games, gadgets and other electronics, but when it comes to food, they prefer to go to the actual store. Or they used to do that…
Last year, in the United States there was just 4% of online grocery sales. But today, during the Coronavirus outbreak, things are changing drastically.
We can say without a doubt that online grocery shopping is exploding. According to CNN, the number of downloads of grocery delivery apps in the US has got over 100 per cent growth (apps like Walmart's grocery app, Instacart and Shipt).
The growth in the number of downloads of these three applications is shown in the graph below:
This is something that could have been expected. The shoppers don`t want to come into contact with other people, so these apps and delivery systems are almost a perfect solution for them at this moment.
What about online grocery shopping in Europe?
When it comes to the three affected countries in Europe, or Southeastern Europe – Italy, Spain, and France, online shopping was mostly dead before this crisis.
Italy and Spain had had the lowest rates of e-Commerce penetration in Europe at 4% and 5% of total retail revenues respectively (according to the Centre of Retail Research). France was a bit ahead of them, with about 10% of online sales.
To better understand the situation and compare it with other countries, we will mention that in the UK 20% of sales are online and in China as much as 36%.
However, the situation in the first three countries is changing rapidly, especially in Italy and France. The consumers are adopting this new kind of behavior and they are buying a lot of things online.
The numbers in Italy are getting doubled, and in France, according to Nielsen Research,the number of people who are buying products from the comfort of their home has increased by 32%.
Positive estimations for the e-Commerce businesses are that after this crisis comes to an end, a large number of people will continue to purchase products online.
Do people buy electronics during the Coronavirus crisis?
People in Europe tend to buy electronics over the Internet much more than food, so yes, this industry is growing. It is growing more than it has ever had.
For example, in Spain, despite the situation, there is a big demand for telephones, smart TVs, children's toys, freezers and other electronics. People are ordering these items online because of their health concerns, which is a normal reaction in the times of a pandemic.
We have also noticed a big increase in the number of electronics sales in the US, on e-Commerce companies like Amazon, eBay, or Target. As with the grocery store apps, the growth in the number of downloads of apps like Target is more than obvious
According to Business Insider, electronics sales experienced a 91% increase. The reason for this is the change in many people's lifestyles, and the shift to working from home.
Gyms were among the first businesses affected by the Coronavirus. Because of the way this disease is spreading, gyms have become a health hazard, so all of them had to be closed.
Nevertheless, people who have been training for years had to find a solution to continue with their workouts, and not get out of shape. This is why the demand for home-gym equipment has increased. The only way to get home workout equipment is by using the Internet, and of course, over e-Commerce websites.
All of the above is presented in the graph below:
The best selling products in this niche are:
- Exercise bands,
- Yoga mats,
- Exercise balls,
- Foam rollers,
- And dumbbells.
- Exercise bands,
- Yoga mats,
- Exercise balls,
- Foam rollers,
- And dumbbells.
Therefore, if you are the owner of a fitness-themed e-Commerce website, this is the time to boost your revenue.
It is more than obvious that the largest growth is currently recorded in the pharmaceutical industry.
People all over the world are now buying hygiene products in incredible quantities.
Their sales growth rate for some product types is over 500%, more precisely, here is what it looks like for each of them:
- The masks sales increase is about 590%
- Hand sanitizer – 420%
- Clorox/Lysol wipes – 184%
- Disinfectants – 178%
- Gloves – 151%
- Bottled/packaged water – 78%
- Vitamins – 78%
- Tissues – 43%
- Hand soap – 33%
- Toilet paper – 26%
According to ContentSquare, visits to healthcare sites went up by 25% during the period from 02/03/2020 to 08/03/2020 compared to a week earlier.
According to Amazon, the best-selling products mentioned are hand sanitizers, masks, but also melatonin tablets, aspirin, liquid medicines, pain tablets and adhesive bandages. Very interesting, indeed.
You probably know that this market is overcrowded at the moment, so you have to find a way to differentiate your products from the others. The great way to do it is by creating uniquely- designed ads. You can do this by using Glorify App, a design tool created specifically for eCommerce businesses. Here are a few Covid-19 related design templates on Glorify.
Click here to get awesome templates for this niche, or ANY other niche you're selling in.
Toys and gaming/entertainment industry
People affected by this crisis are looking for a way to escape from it. At least mentally. As the statistics show, the best way for it is to play with your kids, play with toys if you are a kid, watch movies and TV-shows, or to play video-games.
Many platforms like Netflix are having a growth of subscriptions which is being predicted to rise over 30%.
By Sunday, March 15, Steam, the global PC gaming platform, had an unbelievable 20.3 million concurring users. A record for the number of users at one time has been set!
On the same date, Counter-Strike: Global Offensive, a worldwide famous video game, also reached a record number of simultaneous players.
You might notice that these records were broken on a weekend, a period when gamers have more time to play, but you can't deny that it is related to the Coronavirus pandemic and people having more free time now that they are quarantined.
According to Amazon, the bestselling gaming and entertainment products are:
- Guess Who?,
- Binoculars for kids,
- Nintendo games like Super Mario.
It is more than obvious that this period of crisis is bad for many companies and businesses. Unfortunately, some businesses will be affected by great losses, some will even go into bankruptcy, while some will go through some mild difficulties and changes in order to at least stay on their feet. On the other hand, for some industries, this period is the right moment for blooming.
For those who are able to recognize this opportunity, this is the time to affect their customers and change their habits so when this period passes, they can lead the battle on multiple fronts. Such industries are the food industry, pharmacy, hygiene, and the always adored industry of entertainment.
If your e-Commerce business doesn’t fall under these types of services, do not despair. This period will pass and with time everything will come back to normal. Our advice to everybody is to look at your business from different angles and think about the ways you can deliver your services to your customers.
Maybe it is time for a makeover? Or maybe it’s time to think out of the box and come up with new ideas on how to get more leads at this difficult point. That’s something you as a business owner will have to think long and hard about.
To make things a bit easier for you, here is a video on How to continue your Business Growth during COVID-19 by the CEO of Glorify, Omar Farook!