Not a conceptual surprise, this one. If the horse can’t go to the water, then the water must come to the horse. As people have been confined to their homes (306 million people are home in the US alone) e-commerce and delivery platforms have become their lifelines. The US and Canada, for instance, have seen a huge spike in e-commerce orders. As of 21st April, the growth in online retail orders in these markets alone was 146%.The year-on-year online growth that US retailers saw in April was similar to the last holiday season (in a pre-COVID, less cautious world).
Grocery shopping doesn’t quite explain this spike – so what are people buying?
Everything from washing machines (up 18 times) and dishwashers (grew by 35 times), refrigerators, food processors and, unsurprisingly, exercise equipment. All the stuff you need to be home – kitchen and fitness things. Here’s an interesting list of the top 25 high performing products – it’s an eclectic mix – from Swiss balls, stationary cycles and video-game consoles to soap dispensers, mason jars and make up mirrors.
The Lipstick effect
Recessions have traditionally led to a surge in the sales of lipsticks. COVID has done something similar – but in nails. Nail polish is to COVID what lipstick was to earlier recessions – in fact the whole nail-care industry is seeing a dramatic increase in demand. Nails Inc, England-based nail bar chain, has stated that its e-commerce sales in the U.S. have increased 571% over the last month or so, compared to the same period last year. Another cosmetics brand, Butter London, also saw an increase in nail-related e-commerce sales and witnessed a 150% increase in April sales as compared to March.
People are home and they need things – they also have the time to cook, take up new hobbies, binge-watch, work on their fitness and reflect on life. E-commerce is ferrying it all and, in turn, riding that gravy train. At the forefront of that is Amazon, whose stock was already on a high, having grown 500% in the past five years and even as other retailers have run into tailwinds and laid off staff Amazon has hired 100,000 people for distribution and plans on hiring another 75,000 as orders keep pouring in. Of course, Amazon is not alone in seeing this upswing. The segment is on the rise, so others are riding the wave too. India’s Big basket, for instance, saw a 900% increase in orders. Shopify, a Canadian multinational e-commerce company headquartered in Ottawa, is also seeing tremendous growth and is seeing ‘Black Friday’ kind of traffic on a daily basis.
Online shopping has also led to a boom in the ancillary systems that support it, like logistics companies, which are also witnessing a spike (and also facing a challenge with finding people and keeping them safe at this time).