Online shopping is experiencing significant growth this year because of the pandemic. As an eCommerce owner, you may be wondering how you can take advantage of this phenomenon to expand your business. You’ll find some answers in this article as we talk about the history of eCommerce and how it grew in the last ten years. You’ll also learn about the effects of COVID on the purchasing behaviors of consumers, so you can make informed decisions if and when the next pandemic occurs.

Electronic commerce (eCommerce) is transactions consummated over the Internet. Companies and individuals are engaging in it every time they buy or sell products and services online. The term encompasses other activities, including online banking, online auctions, online ticketing, and payment gateways. Its first transaction occurred on August 11, 1994, when Dan Kohn sold Sting’s “Ten Summoners’ Tales” for $12.48 using a data encryption software to process the credit card number securely. It was historic because it paved the way for other eCommerce transactions through the Internet.

Ecommerce Statistics

Total Ecommerce Sales

• United States of America

During the first quarter of 2010, eCommerce sales registered an amount of $39.29 billion, and by the end of 2019, the Census Bureau reported the figure at $156.58 billion. In ten years, sales figures rose by 398%.

• European Union

In 2010, the European Union posted €118.6 billion in eCommerce sales, and the figure grew to €621 billion in 2019. The number rose by 523% in the last ten years.

• Global Sales

The total eCommerce sales around the world were $572.5 billion in 2010, and it hit $3.46 trillion in 2019. It grew by as much as 604% within ten years.

Top Products and Services Purchased Online

In a 2010 Global Trends in Online Shopping, internet users purchased these top five products and services:

• Books – 44%

• Clothing/Accessories/Shoes – 36%

• Airline Ticket/Reservations – 32%

• Electronic Equipment – 27%

• Cosmetics/Nutrition Supplies – 22%

In the 2018 Statista Global Consumer Survey, the following items were the top ten purchased through the Internet:

• Clothing – 57%

• Shoes – 47%

• Consumer Electronics – 40%

• Books/Movies/Music/Games (excluding downloads) – 36%

• Cosmetics and Body Care – 32%

You will notice that there’s a change in the products and services that consumers buy online within eight years. As such, as marketers and business owners, you want to keep an eye on the yearly trends to make the necessary adjustments to your marketing strategies or product offerings.

The Age Groups of Online Shoppers

According to a Nielsen survey in 2014, the global online purchase intention rate had doubled between 2011 and 2014. However, not all age groups shop online at the same degree.

• Millennial (1981 – 1996) – 53%

• Generation X (1965 – 1980) – 28%

• Baby Boomers (1946 – 1964) – 10%

• Generation Z (1997 – 2012) – 7%

• Silent Generation (1928 – 1945) – 2%

In a 2017 Global Online Consumer Report, it wasn’t the Millennial who was the active shopper.

The number of transactions per year:

• Generation X – 18.6

• Millennial – 15.6

• Baby Boomer – 15.1

However, in terms of the value spent per transaction:

• Baby Boomer – $203

• Generation X – $190

• Millennial – $173

You can learn a lot about the age group statistics. First, although the Millennial has the intention to purchase online, he is not the active shopper. The GenX people are the active shoppers, and the Baby Boomers spend more on a single purchase. What does it mean to your marketing strategies? The AOV (average order value) and LTV (Life time value) are going to play an even more important role than soft stats such as CTR and the number of site visitors when mapping out your strategy around promoting your products to maximise the revenue. The reason Baby boomers spend more per transaction could be due to the fact that they have more disposable income to spend on online shopping. If it is true, the type of product to promote and a price point should also be carefully considered depending on your target audience.

Top Five Ecommerce Markets

According to the 2019 Global Ecommerce Market Ranking, the following are the top markets in terms of revenue:

• China – $636.09 billion

• USA – $504.58 billion

• Japan – $104.04 billion

• UK – $86.45 billion

• Germany – $70.35 billion

Ecommerce: What the Future Holds

The past decade showed that eCommerce had been steadily increasing across the globe by 20% per year. However, because of COVID-19 restrictions, we notice a significant growth in online shopping because people no longer go out and shop in physical stores. Although it’s too early to make a forecast for this year, it’s possible to exceed the yearly average.

Product Categories Affected by the COVID-19 Pandemic

Because of stay-at-home orders and social distancing, people turned to eCommerce sites for their everyday needs. However, they also changed their buying choices, consequently, the product categories also changed.

According to Nielsen, six significant consumer behaviors correlate with the COVID-19 pandemic:

• Buying preventative wellness and health products

• Purchasing hand sanitizers and masks

• Stockpiling household essentials and groceries

• Preparations for quarantine

• Restricted living

• Experiencing a new normal

Because of the change in purchasing behaviors, people are no longer buying the perennial items bought online in recent years. This year, the following product categories experienced substantial change:

Health and Safety Products

Everyone who found empty shelves in brick-and-mortar shops or saw how the price escalated quickly only knew that health and safety products are the most saleable items during the pandemic. Products like medical and hygienic masks experienced an increase in sales by at least 300%.

Pantry Essentials

People plan for long-term quarantine, so they buy consumer-packaged goods that they keep in the pantry. For instance, milk and milk substitutes experience an enormous jump in sales by as much as 300%. Other products that have a long shelf life also have sales increases.

Food and Beverage

Sales of grocery items are also up, but there’s also a change in how people shop. Instead of buying at supermarkets, they now opt for delivery or BOPIS (Buy Online, Pick-up In-Store). Downloads of apps for personal shoppers have increased from 124% – 218%. Consumers now buy more items from eCommerce sites.

Digital Streaming

Although it’s not as immediate as feeding and protecting oneself, it’s not surprising to see digital streaming services find their way into homes because people no longer pursue external entertainment alternatives.

Luxury Goods

Aside from entertainment, travel, and restaurants, luxury goods also experience a significant decline in sales. According to Vogue Business, sales can decline by €40billion in 2020 because the industry relies heavily on the purchasing power of the Asian market, where the pandemic affected consumers since the start of the year.

Fashion and Apparel

Omnichannel sellers are also experiencing tremendous losses because they decided to close their retail arms. People are no longer shopping for clothes in brick-and-mortar stores; thus, department stores, large chains, Direct-to-Customer brands, and other storefronts are experiencing losses. Sales of online apparel are also down because consumers buy only their daily essentials.

Final Thoughts

Quarantine orders and social distancing guidelines bring about the changes in eCommerce trends. However, if retailers think that consumer habits will revert to pre-pandemic conditions, they may be up for a surprise. These behaviors can be challenging to reverse and will become permanent, especially if they have a positive experience from online shopping that ultimately changed their buying habits. As such, eCommerce retailers and marketers must take heed of the change in trends if they don’t want to be left behind by the bandwagon.

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