The world is dealing with yet another pandemic that will have a serious impact on the business sector. Many of the newly started companies are going through tough times, and it might lead to forced business closure. There are more than 350,000 coronavirus cases worldwide and 16,565 deaths until now. This number will continue to rise as the hotspot moves from China to Europe.
Coronavirus vs. eCommerce
Just because people are now staying home in order to stay safe, the eCommerce market is growing rapidly. From the latest study, we got rather interesting statistics. Almost 50% of Chinese and more than 30% of Italian consumers say that they are using eCommerce services more frequently. Other countries also have increased eCommerce users, just not on that scale.
Businesses are switching from physical stores to online stores in order to dampen the impact of the virus. On the other hand, the increased use of online shopping doesn’t tell us anything about the future. Many of the consumers have been stockpiling, which means that they are not the real numbers that businesses can expect under normal conditions.
One of the most popular categories of eCommerce businesses is the grocery stores that provide home delivery. Only in the US, the number of downloads on such apps went up by 218% compared to February.
As we can see, the growth from the eCommerce market is based on everyday products. When it comes to luxury goods or something that people don’t necessarily need, there is a decrease in orders. In April, Aliexpress reported the same order activity as usual, but that number is expected to decrease since we will see the peak of the virus in Europe and the US in a month.
Coronavirus vs. Marketing
When it comes to marketing, the situation is a bit different due to the industry that your business operates in. For instance, experts predict a minimum of 15% decline in travel ad revenue during Q1. This means that fewer travel companies are spending money on Google due to the latest situation where people cannot travel anywhere in the world.
This is not something that can be easily surpassed, as they also predict more than 20% decline in Q2 depending on the situation and the scale of the outbreak.
It is not only about travel companies. The entertainment industry, such as cinemas and restaurants, are not spending any money on marketing just because they are closed in most countries.
Big organizations predict that people will have delays in spending decisions after this crisis. This will have a significant impact on the marketing business since companies will have to advertise more in order to get people to spend their money. Unsurprisingly, 62% of interviewed firms said that they have delayed or cut in their marketing budget plans.
Obviously, the pandemic will not last forever, but the recovery of the marketing sector is going to happen after a year. This means that everything should be back to normal after some time passes and people start living and spending money as usual.
The situation is a bit worse when it comes to outdoor marketing, such as shopping malls or billboards. It is hard to find companies that are willing to advertise their brand when some shopping malls are closed, or there are significantly fewer people on the streets.
The good thing is that the eCommerce business is growing rapidly, and the question is whether people will stay in this trend in the future still remains. Experts predicted that 95% of all transactions would be done online by 2040, but it seems like people will convert to online shopping much quicker than we expected.
However, with this pandemic, it is hard to estimate or predict something just like you can’t predict who will win the Kentucky Derby horse race winners, just because the odds can change every day. Businesses should be strong overcoming these tough times and expect an increase as soon as the pandemic is a thing of the past.