[ShipStation] The Impact of Coronavirus on E-Commerce

March 26, 2020

The arrival of the coronavirus outbreak, or COVID-19, has had a major impact on the way we live our lives and interact with one another. Not only has it changed day-to-day life, but it has also had a considerable effect on e-commerce. 

Our friends at ShipStation conducted a research study to see what impact this virus has had on U.S. consumer expectations, and the results are shocking. In fact, by the time the study was conducted in early March, 20% of respondents had already received a delay or cancelation of an online order due to the virus.

Brick and mortar retail is one of the hardest hit industries during the coronavirus outbreak. ShipStation’s study revealed that 80% of people are avoiding stores and malls due to the concerns. With more cities and states implementing “shelter-in-place” or other restricted behavior, the impact will be even greater. This also means that e-commerce merchants are getting a bigger piece of the shopping pie. 1 in 5 respondents are doing more online shopping resulting from concerns of the virus.

Merchants not only need to prepare for increased online shopping demand, but they also need to be aware of a possible shift in consumer spending attitudes. Shoppers are prioritizing the “need to have” items and are spending less on products that fall into the “want to have” category. In addition, people are more concerned about where products come from, with 64% of consumers saying the virus made them more aware of product origins. 

One thing to keep in mind is consumer confidence, which can diminish product demand if it decreases. 84% of consumers say they need proactive and transparent communication if a delivery is delayed or canceled due to Coronavirus. Similarly, 81% of consumers want the ability to cancel an order altogether if there are delivery or order changes. 70% of consumers want an extended returns window to accommodate a delayed delivery, and 34% want a discount to apply to their next order. These requests may be different than your current policies, but it is important to be flexible and accommodating in these uncertain times to increase consumer confidence in your brand and products.

The last topic to be mindful of is supply chain impacts due to the coronavirus, like lack of inventory or restricted delivery regions. If your products are especially at risk for delays, make sure your communications are transparent and you have a flexible return policy to preserve customer confidence. 78% of consumers day their brand perception will not be impacted negatively as long as the company provides information. These circumstances are unexpected and confusing for everyone, so try to operate your business with honesty and flexibility as we navigate this uncertainty.