What is the Impact of COVID-19 on eCommerce Businesses
The global pandemic of COVID-19 has turned the business environment upside-down across the globe. Businesses are at the forefront of facing new challenges, cross border trade has been impacted tremendously, physical stores have been shut — all this while people are requested to isolate themselves at their homes.
There has been a paradigm shift in how people shop, and that too on a massive scale. With all of this happening, eCommerce businesses have been impacted to a great extent. After the government allowed the closing of all non-essential businesses, essential items had become the new normal.
People started buying products in bulk which required businesses to adapt and be flexible to meet these changing needs.
Bulk buying is the purchase of a large number of items at one time. People opted for bulk-buying because there was uncertainty regarding the availability of those items in the coming days. Hoarding items at home became common, which put businesses under a lot of pressure to refill their inventory time and again.
Soon, brick-and-mortar and online stores dealing with essential products struggled to keep up with the demand, as the prices of such items started rising.
With the pandemic hitting the entire globe, eCommerce businesses faced severe challenges.
According to a report by Economic Times, experts are of the view that as India’s curbs on full-fledged eCommerce began only at the very end of the first quarter, the total impact is yet unknown. Forrester Research has revised its estimate for growth in India’s eCommerce sector to just 6.8% for 2020 with a warning that it could be further lowered.
Businesses have to think about their level of readiness, and whether their online platform is capable of offering a seamless user experience or not. If the business fails to do so, chances are it will fail to impress or retain customers.
Companies need to deliver the best eCommerce shopping and delivery experience possible. To start with, they must be discoverable via search engines at the time their customers wish to make a purchase. Once customers are on the site, the eCommerce platform must be responsive and meet or exceed customer expectations.
eCommerce Scenario During The Global Pandemic
According to Morgan Stanley’s report, before the COVID-19 outbreak, it was predicted that the eCommerce market growth in India would reach 200 billion dollars by the year 2026. Post the outbreak, trends suggest that this goal will be reached much sooner than expected.
Why so? Because customers are opting for online shopping amid fears of coronavirus spread if they leave their homes. This is good news for the eCommerce sector, but reaching this goal also comes with further limitations.
While the eCommerce sector has witnessed a rise in demand, the supply chain has been badly impacted due to several restrictions imposed on the movement of goods amid the nationwide lockdown.
Another major challenge is the shortage of staff to attend to the rising orders. Big eCommerce giants such as Flipkart, Amazon, and hyperlocal experts such as Bigbasket and Grofers have access to only half of their regular staff and hence can only meet order deliveries at a reduced frequency which has put pressure on the availability of slots for consumers.
On the other hand, there are many B2B services that have been launching new platforms in the area of delivering essential items to customers across the country.
Shiprocket hyperlocal services are one such initiative by Shiprocket — a leading shipping and logistics aggregator — that allows sellers to ship essential items such as groceries, food products, personal and baby care products, etc to customers living within 50 km from the pickup location. This allows medicine shops, Kirana shop owners to reach a wider range of customers and also ensures people availability of essential items at all times.
The government is also supportive in tapping logistics firms like Shiprocket to link these physical shops with consumers and simultaneously relaxing the required approvals for opening such stores.
eCommerce businesses are also improvising amid the lockdown to stay afloat. Online food ordering and delivery platforms like Swiggy and Zomato have introduced contactless deliveries to allay heightened apprehensions related to hygiene that exist right now.
In the near future, the eCommerce sector will continue to see a boost in sales, as people would remain apprehensive of stepping out frequently even after the lockdown ends. But again, in the short term, scaling up of the supply chain in keeping with the required safety measures will be a challenge.
While it is safe to say that the entire eCommerce industry will not be seeing a positive net change, the fact that it shall surely thrive more than brick and mortar stores can be a relatively safe assumption. In the long term, however, the growth of eCommerce would depend on how efficiently they provide and adapt their services in accordance with general consumer needs.
