You’ve heard of Sting, right?
Apparently, it wasn’t just the world of music that this singer/songwriter transformed.
It was Sting’s 1993 album, “Ten Summoners’ Tales,” that made history as the first retail transaction to take place on the internet.
So, you could say it was the purchase of a Sting CD in 1994 that catapulted our society into the e-commerce-dominated world we live in today.
E-commerce, or electronic commerce, refers to business that is conducted on the internet. Any time a transaction is made online, regardless of payment method or product/service, the participants of that transaction are engaging in e-commerce. This includes more than just your usual online shopping; e-commerce also comprises online banking, auctions, and stock investing.
Why has e-commerce become so popular?
1. Convenience: With the emergence of e-commerce, online stores and services have the unprecedented ability to remain open for business 24/7. A consumer can shop from anywhere, at any hour of the day.
2. Overhead Costs: Without a brick-and-mortar location to maintain, businesses operating in e-commerce alone have very little overhead costs to consider.
3. More Reach to Customers: E-commerce has removed all geographical and/or time constraints, allowing businesses to reach more people in more places. This means that a business’ target consumer could expand to an international reach, potentially multiplying its sales and profits.
While retail e-commerce has been increasing significantly year-over-year, the harsh arrival of the COVID-19 pandemic has tremendously elevated its necessity in today’s retail industry.
In March 2020, international restrictions aimed at slowing the spread of COVID-19 have affected how consumers around the world could shop. With businesses completely and suddenly halting their in-store operations, the option to purchase online has become the only alternative to walking into a store.
From February to May 2020, retail e-commerce sales in Canada went up by 99.3%! These record gains in e-commerce occurred alongside the record declines experienced by retail sales.
Businesses and entrepreneurs worldwide have jumped on the bandwagon, with the numbers continuing to increase daily. With so many transactions being forced into the virtual landscape, e-commerce is forecasted to bring in $27 trillion by the end of 2020.
Although we are still seeing the full impact of the pandemic on our shopping experience, the first half of the year has seen some very interesting trends.
2020 e-commerce trends:
• In the first six months of the year, consumers spent $347.36 billion with online U.S. retailers. This is over a 30% increase from the same time last year.
• Food delivery service searches rose by 180% worldwide.
• Home and Garden, Food and Groceries, and Sports and Outdoors, are the retail categories that have shown the biggest rise in traffic, at 40-50% higher than the previous year.
• 70% of all online site visits have taken place on mobile devices.
With e-commerce taking over nearly all aspects of our daily lives, it seems likely that our reliance on it won’t be waning anytime soon. But will the explosion of e-commerce in the wake of the COVID-19 pandemic have the potential to restructure the future of the Canadian retail industry?
We don’t know about you, but we certainly miss the “old normal” of stepping into our favourite store and browsing with our hands as opposed to our browsers.