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Retail Ecommerce throughout the Coronavirus Outbreak: April Updates

The coronavirus pandemic has a growing impact on the global economy. Retail ecommerce during the coronavirus outbreak continues to increase year over year for many retail categories. NetElixir is analyzing the situation to provide retail industry leaders with a perspective on how to engage new potential customers and adjust their marketing mix accordingly. We saw retail ecommerce sales continue to rise throughout the month of March, with food and grocery being the lead retail ecommerce category. Throughout the ongoing weeks of the pandemic, consumers turn to online shopping as a viable means of securing their essential goods, as well as supplementing their time at home.

Since February 9th, NetElixir has been compiling real-time data on how the coronavirus outbreak is impacting retail ecommerce sales, online shopping behavior, and ad spend.  Our most recent webinar on the effect of the pandemic on retail ecommerce on April 23 showcased customer analytics data through April 18. 

NetElixir aggregated and analyzed the daily online sales metrics across seven retail categories over five two-week periods, as follows:

  1. The Beginning, from February 9 to 22
  2. The First Spike, from February 23 to March 7
  3. The Outbreak Spreads, from March 8 to 21
  4. The Second Spike Starts, from March 22 to April 4
  5. The Second Spike Continues, from April 5 to 18

The seven retail categories considered in our dataset are:

  1. Apparel (which includes accessories and fast fashion)
  2. Food and Grocery
  3. Gifting (which includes greeting, cards, gift baskets, and faith-based products)
  4. Home Furnishing
  5. Home Decor
  6. Pet Supplies
  7. Tools and Hardware (which includes gardening)

Kaki Zell of Ames Walker joined NetElixir’s Founder and CEO Udayan Bose for a Q&A into the apparel industry. Zell’s Q&A will be recapped in Monday’s upcoming blog post. 

HOW IS THE CORONAVIRUS OUTBREAK CHANGING THE RETAIL ECOMMERCE LANDSCAPE?

  • The gap between Google-led sales and Social Media-led sales (most notable from Facebook) is about 2:1, down from pre-coronavirus average of 7:1 in favor of Google ads.
  • Increased conversion rates across retail categories (except apparel) point to a higher propensity in customers completing a purchase. New online customers, especially within the 18-24 age group, are converting into purchasing customers more quickly.
  • The Apparel Industry saw its first week over week increase since NetElixir began collecting daily data. As this correlates with the distribution of stimulus checks, the increase suggests a pent-up demand for apparel, as well as other categories, that could be released post-coronavirus.

Read below for a full summary into the recent data NetElixir collected.

How are Online Shoppers Boosting Ecommerce Sales During Coronavirus?

The distribution of the stimulus checks in the United States caused a slight spike in sales, especially for the Apparel retail industry. Bose says that this suggests a “pent-up demand,” that “people are willing to spend and looking to spend and ready to spend” when brick-and-mortar stores reopen. 

Ecommerce sales are growing at a rapid rate across industries. The Apparel industry even saw its first week over week increase since NetElixir began compiling data (year over year, Apparel is still under-performing; however, the increase in sales since our last webinar suggests a promising post-coronavirus recovery).

With sheltering-in-place rules extending, people started adjusting more to the ‘new normal’ and spending in more ecommerce categories beyond Food and Grocery. Food and Grocery ecommerce sales have decreased within our most recent period of study (April 5 to 18). 

The ecommerce sales that we are seeing “far surpassed our expectations,” Bose says.

April Ecommerce Sales during coronavirus outbreak
Ecommerce sales for April continue to grow beyond what NetElixir projected near the end of March.

Now is a great time for Food and Grocery ecommerce industries to capitalize on new user’s attention. Gifting, Pet Supplies, and Tools and Hardware retail industries have also been performing exceptionally well within the current circumstances. For strategic and nimble marketers, there are opportunities.

As uncertainty around the situation lingers, marketers question the longevity of new online shoppers. Bose suggests segregating existing clients from new customers and establishing different KPIs for each segment, as each responds to brands and online opportunities differently. As the situation changes weekly and daily, these opportunities are short-lived.

We don’t know how customers will adjust post-pandemic. Many of these online shoppers are a new entity that was won due to the pandemic’s unique and unprecedented situation. The shopping habits and experiences of these new shoppers could result in different, long-term changes in overall shopper behavior. NetElixir will continue to monitor these new shoppers’ behaviors to see how they evolve.

New online searchers are converting to purchasing customers quickly. In measuring website conversion rates, businesses can see consumers’ propensity to purchase and measure the likelihood of completing a new purchase. In the year over year conversion comparison below, every retail industry within our dataset (except Apparel) is experiencing growth:

Website Conversion rates in April; how the coronavirus outbreak is impacting online shopping behavior
Website conversion rates for all retail categories (except apparel) are experiencing year over year growth. Data as of April 18, 2020

NetElixir’s research has found that the 18-24 age group is the fastest growing sector of new online shoppers, followed by the 45-54 age group. The 18-24 age group also completes a purchase more quickly, decreasing overall latency between first website visit and first online purchase. 

Overall, people are buying at a higher percentage and also purchasing more quickly. 

Advertising During the Coronavirus Outbreak

CPCs are in constant decline, which is “something that continues to surprise us,” Bose says. He continues that this is the time to win new customers at a more cost-effective rate, compared to earlier and last year’s data.

CPC across retail industries to for Google ad spend during coronavirus outbreak
Based on our most recent research (pictured in light blue), CPCs across most retail categories continue to decrease. This presents an opportunity for marketers to reach new customers in a cost-effective way.

Return on investment for Google ad spend is usually (under more normal circumstances) stronger than social media ROI. However, Facebook ad ROI has now increased. The gap between Google-led sales and Facebook-led sales used to be around 7:1 in favor of Google, but has since decreased to 2:1. There are paid social marketing opportunities, especially for YouTube and TikTok.

Strategic marketers can invest in the opportunity presented by near-historical low CPCs and high customer conversion. As marketers start seizing these opportunities based on real-time data, the ad and search landscape will shift. 

In this increasingly virtual world, brands can only reach their customers through screens. Websites and digital outreach become increasingly more important to connect with existing and potential customers.

Additional Insights

 

Ames Walker Discount Code; face masks washable
Use this discount code at checkout at AmesWalker.com. Valid through the end of April 2020.

Kaki Zell, Co-Owner and Vice President of Ames Walker who spoke on how her company shifted production capabilities to manufacture masks, joined our webinar for a Q&A. For partnering with NetElixir, Zell graciously offered a discount at Ames Walker’s site, valid through the end of April, 2020.

Experts weigh in on coronavirus impact
Ghose is a world class speaker, best selling author, and the Heinz Riehl Chair Professor at NYU’s Stern School of Business. Ghose will speak on how AI and tech influence the research surrounding coronavirus on Tuesday, May 12.

We will be hosting a new webinar series, starting Tuesday, May 12 at 2 PM ET. Our X=Experience: Expert Series pulls together previous speakers from our annual X=Experience event to provide insights and strategies to navigate the coronavirus crisis. Our first webinar of the series on Leveraging AI, Data, and Tech Platforms To Understand Health Pandemics will be presented by Anindya Ghose. Register now.

You can watch our March 11 webinar here, which was the first of the series on tracking the impact of the coronavirus on ecommerce sales and online shopping behavior.

Our March 26 update webinar featured our first Retail Superhero, Parag Shah, the Vice President of Grocery at Wakefern Food Corporation for Shoprite,  and detailed over a month’s worth of research.

The third webinar in our impact of Covid-19 series, which aired on April 9, featured UPS’s President of SMB and US Marketing, Gerard Gibbons, for a live Q&A.

While we have covered an extensive dataset, it is by no means exhaustive. If you are interested in discussing specific insights for your category, please email us at shareinsights@netelixir.com

Further Reading on Ecommerce Updates During Coronavirus

You can join the conversation on social media using #NxInsights.

Our Founder and CEO Udayan Bose emphasizes the importance of real data. Real-time data, gathered daily by our Retail Intelligence Lab, shares a glimpse into how people are coping day by day. For further reading, you can see our prior retail analytics updates on retail ecommerce and online shopping behavior:

The webinar can be watched in its entirety below.

First published April 24, 2020. Updated May 28, 2020.