Digital Commerce 360

Coronavirus adds $105 billion to US ecommerce in 2020

Coronavirus adds $105 to US ecommerce in 2020

Ecommerce was growing fast before COVID-19 hit. But the pandemic pushed even more U.S. consumers online, contributing an additional $105 billion in U.S. online revenue in 2020 and accelerating ecommerce by two years, Digital Commerce 360 estimates.

Online sales hit $791.70 billion in 2020, up 32.4% from $598.02 billion in the prior year, according to Commerce Department figures. That’s the highest annual online sales growth of any year for which data is available.

Ecommerce thrived in 2020 because of store closures and shoppers’ fear of contracting the coronavirus in public. And figures from Q1 2021 show that the coronavirus is still making an impact on retail spending. Online sales increased 39% year over year in Q1 2021, nearly triple the 14% increase in Q1 2020, and faster than Q3 2020 and Q4 2020.

Q1 2021’s fast ecommerce growth is likely because of consumers spending their stimulus checks and tax returns. Plus, with the coronavirus cases spiking in January, many consumers were still avoiding stores and purchasing online. This, coupled with shoppers beginning to purchase products for their post-vaccine life, such as luggage, teeth whitener and vacation apparel, all contributed to the 39% increase.

Coronavirus impacted retailers of all types in the past year and a half, and Digital Commerce 360 researchers and editors had a front seat to the action. We collectively interviewed dozens of merchants, conducted multiple retailer and consumer surveys, and hosted virtual events and webinars to hear how retailers handled these new challenges.

Below are top articles over the past year with in-depth looks on various topics, such as supply chain snarls, customer service struggles over the holidays, and a boom in services such as same-day delivery, curbside pickup and virtual appointments. Other highlights include case studies with merchants like Pepsico and Kellogg, which shared how their ecommerce investments paid off during the pandemic, and Spiceology, which had to pivot to focus on end-consumers instead of its restaurant clients.

We’ve learned a lot about how resilient, scrappy and innovative merchants can be. And we hope our readers learn lessons for their businesses as well.

—Digital Commerce 360 Editors

Fulfillment & COVID-19

Coronavirus drives innovation in fulfillment 
Retailers and delivery companies struggled to make on-time deliveries during the COVID-19 pandemic. Still, shipments are slowly getting back on track, according to NorthShore Care Supply, which found ways to better automate its fulfillment during the crisis. 

Merchants use stores to tap into same-day delivery 
With shipping carriers maxed out during the pandemic, retail chains leaned on their stores and delivery apps to quickly meet consumer demands for same-day delivery.  

During the pandemic, Walmart and Target leverage their stores 
The mass merchants ramped up omnichannel services at their thousands of U.S. stores, resulting in enormous gains in online sales. Digital Commerce 360’s 2021 Omnichannel Report reveals more about how retail chains weathered the pandemic in 2020.

Scenario planning is the name of the game for retailers this unusual holiday season
Holiday forecasting and logistics planning are tough enough for retailers in a typical year. But developing a fulfillment strategy that adequately addresses supply chain, inventory management and delivery options for the all-important November-December period became a herculean task in 2020.

COVID-19 Data & Trends

2020 changed the face of grocery retailing—likely forever 
The coronavirus pandemic changed consumer habits, forcing food retailers to adapt quickly. Millions of households started buying groceries online for pickup or home delivery and many will continue using ecommerce options after the crisis passes.

Pandemic causes US ecommerce to surge north of 32% in Q4
More than $1 in every $5 spent on retail purchases during the quarter came from online orders, Digital Commerce 360 estimates. Amazon accounted for more than half of all ecommerce gains in the United States. 

How retailers managed the surge in customer service inquiries over the holidays
The coronavirus pandemic spurred more online shopping, more delayed shipments and more customer service inquiries. These increases were further amplified during the 2020 holiday season, with customer service call volumes increasing triple digits.

How the coronavirus is affecting online retailers in early 2020 
In the short term, retailers that sell supplies like toilet paper, face masks and water bottles had significant sales gains due to the coronavirus. Long-term, however, retailers were concerned the coronavirus would negatively impact their 2020 revenue.

The pandemic sends online wine sales soaring in 2020 
The COVID-19 crisis prompted a huge surge in online wine orders. Retailers believe the habit of buying bottles and cases online will endure after the pandemic passes.

Retailers pivot to adjust to the pandemic
The world has been upended with the coronavirus—and that includes retail. Here are some examples of how retailers adapted their businesses to survive—and thrive—during the pandemic. 

COVID-19 Consumer Insights

The Shopper Speaks: Ecommerce favorites from 2020 and what I will do more of in 2021
It is promising that retailers rose to the occasion to accommodate current circumstances, endearing shoppers to new ways to do business under these trying times, writes Lauren Freedman, senior consumer insights analyst, Digital Commerce 360. 

 The Shopper Speaks: 3 secrets why curbside will not die post-COVID-19
Lauren Freedman, consumer insights analyst at Digital Commerce 360, delves into the details on in-store and curbside pickup given the growing interest among consumers and retailers alike.

The Shopper Speaks: Virtual appointments
While necessity is the mother of invention, virtual appointments are one instance where the service will likely see long-term adoption, writes Lauren Freedman, senior consumer insights analyst at Digital Commerce 360.  

COVID-19 Case Studies

With restaurants closed, online retailer Spiceology shifts focus to consumers 
Overall sales at Spiceology.com are still growing, but not as fast as projected at the start of 2020. Losing sales from chefs means losing large, high average order value transactions, CEO Chip Overstreet says.

How PepsiCo’s ecommerce investments pay off in the wake of COVID-19 
PepsiCo’s head of global ecommerce shares how its earlier investments in ecommerce helped the CPG giant handle a surge in orders across online channels as consumers shifted to online shopping because of the pandemic. The investments include developing a robust analytics platform and establishing cross-functional teams to work with its retailer customers.

Kellogg says embracing ecommerce helped it weather the pandemic 
Kellogg says its ecommerce investments over the past two years helped it respond quickly and seize opportunities when lockdowns related to COVID-19 sent online grocery sales to record levels.

E-retailers make technology upgrades during the coronavirus 
Retailers relying more on data, content management systems and servers as their ecommerce sites are put to the test during the pandemic. Here’s how two retailers in suddenly hot product categories adapted to shifting consumer behavior, causing surges in web traffic, decrease in store-based sales and spikes in online sales.

A bedding manufacturer lays out how coronavirus is impacting its business
The consumer shift to shopping online during the pandemic has prompted American Textile to focus more on its ecommerce business. However, the online sales surge was not enough to cushion the blow the company took with the physical retail stores it sells in being closed. 

Supply Chain & COVID-19

Supply chain snafus snarl online retailers’ holiday plans
The coronavirus pandemic closed many factories in China and elsewhere early in 2020, leading to clogged ports and merchandise shortages for retailers during the holiday season. With online sales soaring and some products in short supply, web merchants cut back on discounts and pondered how they might minimize similar problems in the future. 

Coronavirus is infecting supply chains. Merchants can minimize disruption now—and in the future—by going digital
Retailers need to be agile and able to quickly shift what product goes where and when products are shipped to them. They also need immediate insight into where all their inventory is at any given moment.