The impact of COVID-19 has stretched beyond that of the average household and had an immense economic impact on global markets across nearly all sectors. With COVID lockdowns lifting, businesses are left reassessing consumer behaviour and sentiment.
Companies are looking for new ways to engage with their customers to bounce back. As everyone from retailers to medical experts took their businesses online, eCommerce boomed. That begs the question, will online sales slow down now that COVID lockdowns are over? Faced with the choice between convenience and fresh air, what will consumers choose?
The Start of the COVID Pandemic
The Australian government’s first step was cancelling the Australian Grand Prix on Friday the 13th of March 2020. By the 18th of March, international travel restrictions were put into place, and wage subsidies were implemented by the 30th of March. The Australian government pre-empted the economic impact. while shop shelves emptied due to panic buying. Retailers and businesses were forced to prepare for what was to come, so many began to increase their online presence to accommodate their clients during lockdown.
The Effects of COVID on Physical Retail Outlets
During lockdown, brick and mortar businesses took strain, and many had to close altogether. Turnover fell and continued to fall month-on-month; the fall in turnover was in line with each state’s respective level of restrictions. States and territories with no lockdowns performed well because they were still open for trade.
More agile businesses found ways to adapt and make the most of the new business landscape. These businesses were meeting people where they were – at home. This meant improving websites, improving delivery options, and lowering the risk of infection for those who continued to shop in-store.
Are Consumers Spending Again?
By the December quarter of 2021, retail sales rose by 8.2%, the strongest quarterly rise on record. In the following months, however, economic data shows a return to lockdown behaviour. Despite the lifting of lockdown, sales for online and in-stores have dropped again. States such as Sydney and Melbourne have pulled back even more; to levels closer to those during lockdown. As a result, all businesses are left looking for more solutions.
Bridging the Divide Between Physical and Online Shops
Physical outlets have had to adapt; they have to adhere to social distancing and hygiene rules and improve shopper experience to ensure customers return. Many other retailers have shifted to online sales only. Online-only retail was already trending, but the COVID-19 pandemic accelerated these changes.
The online shopping experience is enhanced by websites suggesting items that match or are frequently bought together. Other technology allows customers to video chat with employees who walk around the shop to pick up and describe items. While consumer activity has declined in the first quarter of 2022, online stores will continue to innovate to maintain their market share. For now, it is too soon to say whether online sales will slow or whether consumer behaviour has changed permanently.
Online businesses typically have fewer overheads than physical stores, giving them the upper hand required to weather an indecisive market. But online companies still have to streamline their processes and systems to keep costs down. Software such as Tencia offers stock monitoring and analysis, and many other functions. This scalable software is perfect for online retailers as it gives businesses the ability to shift with the economy as necessary. For more information, get in touch to book a product demonstration today.