2020 was a year like no other in the eCommerce industry. Fears about going out in public coupled with mandatory government lockdowns of retail stores caused consumers to flock to the internet to purchase goods and services, simply because they had no alternative. Online shopping became the norm for many people who had never or rarely bought things online. In fact, according to this Digital Commerce article, online sales rose by a record 32.4% in 2020.
Although we are best known for StoreCoach.com, where we broker eCommerce stores and sell them in our dropship business marketplace, the bulk of the income my brothers and I earn is from the eCommerce stores that we privately own and operate. Over the years, we have owned more than 180 online stores and have been lucky to experience the growth in e-commerce from its earliest days.
While it is true that all of our websites saw pronounced growth in 2020, a few of them exploded in sales, with dollar figures that we never even thought were possible. As 2021 rolled around, we didn’t know what to expect. Most of the country had reopened for business and it was only natural to expect a decline, year over year, in sales. We braced ourselves for a return to normal with sales figures more resembling 2019, but that just didn’t happen.
We are beating the 2020 numbers on all of our websites and it turns out that we are not alone. According to the U.S. Department of Commerce, online sales in 2021 are beating 2020’s record setting numbers by more than 9%.
So, what is causing this continued spike in online sales? There are a number of things driving the unexpected continued growth in Ecommerce. Here’s what’s happening and why …
Lingering Fears Surrounding COVID-19
Although more than half the country has received a vaccination for COVID-19, there are still lingering fears about getting the virus even among the vaccinated.
Reported “breakthrough” cases have led some to continue to avoid public places and many in the elderly community are particularly concerned about getting even a mild case of the virus.
They’ve turned to the one place they can shop safely – the internet.
Proof of Vaccination Requirements
In certain areas of the country, local or state governments have issued mandates that retail businesses require proof of vaccination before someone can enter their establishments. Because nearly half the country remains unvaccinated, half the people have no alternative but to shop online.
Making matters worse, many vaccinated people do not appreciate the hassle of having to prove their vaccine status or not being able to shop with their unvaccinated friends. If they’re going to be alone while shopping, they might as well do it from the comfort of their homes.
Mask mandates are just one more thing that many people find obtrusive. Promises that a vaccine would return the country to normal did not come true as public mask mandates still remain in large portions of the country – even for the vaccinated.
Many have reasoned, “Why deal with the discomfort of wearing a mask when you can shop mask-free online?”
A New Online Consumer Base
Because there was no other way to buy things than to do so online, 2020 converted a whole lot of brick and mortar only shoppers into online shoppers. Many people who had never bought things online learned how convenient it was and how there was more variety, greater availability and often lower prices online.
Many of the converted continue to shop online in 2021, even after restrictions have been lifted in their areas.
Bare Store Shelves
Various government policies and shutdowns throughout the world have caused a considerable shortage of goods. The reasons are many, including employee shortages, mandatory shutdowns, a container shortage and a lack of truck drivers.
This has driven people to look for those goods online, further boosting sales in 2021.
What to Expect in the Months and Years to Come
There’s no reason to believe that any of the reasons cited above are going to change in the coming months. In fact, things only seem to be getting worse – especially on the supply side of things.
Many experts are already telling consumers to buy their Christmas presents now or they probably will not have much under the tree on December 25th. Unfortunately, not a lot of people will listen to these warnings and they will realize too late that their local stores have run dry.
Online sales will continue at a record breaking pace for the rest of this year – especially in the 4th quarter, when eCommerce stores become the only place left to buy gifts. Websites that make it easy to see what the fast shipping products are will be the ones who profit the most.
The pandemic of 2020-2021 caused many changes. Perhaps the biggest one is the way that consumers purchase things. In an April article by Forbes, Jason Woosley, vice president of commerce and developer experience at Adobe said “The changes we’re seeing are things that are going to carry forward for generations”. We couldn’t agree more!
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