E-commerce: Groceries goods are projected to keep increasing in 2021

Due to the Covid-19 lockdown, e-commerce in general surged. As a result of immersion in the digital age, globalization, and technological advances, online shopping has spread worldwide, expanding opportunities for both entrepreneurs and shoppers, redefining the boundaries of commerce. Before the pandemic, E-commerce was growing at a not unimpressive rate of 4.5% per year globally. In contrast, in 2020, especially the third quarter of the year, an increase in e-commerce platforms was reported globally; in the US, there was up to a 30% increase compared to 2019.

The restriction measures for outdoor activities and mainly with retailers force both merchants and consumers to adopt online shopping modalities. This has led to Items that would not usually be bought online, such as groceries, becoming one of the categories that registered the highest growth peaks, especially in the second quarter of 2020, showing an increase of 221% compared to the second quarter of 2019. The lockdown coupled with opportunities offered by online stores.

Let’s look at the case of the Lidl offers; Lidl prepared a special of vegan products, this type of offers have their target, but at the same time, making them for a stipulated time allows businesses to evaluate the response of users. This feedback and learning activity in the producer, distributor, and consumer chain is a great opportunity for the company to evaluate users’ responses. Directing the buyers’ focus not only on the current necessity but also on the advantages of this shopping modality.

Shoppers have shown a higher level of engagement on brands’ and retailers’ social networks, reinforcing their interest in online shopping. Many of the stores that have not been able to adopt an online modality have faced bankruptcy due to long months of inactivity. If e-commerce was once an option, it is now necessary for both large and small businesses to build an online presence.

Online shopping was not commonly an option for buying essential products, mainly because of the immediacy of going to the store and buying. In contrast, online shopping is more related to the package and the waiting period. The impossibility of buying freely in face-to-face shopping meant a paradigm shift, making agents explore and exploit all possibilities. Traditional offline advertising techniques suffered a huge decline, while brands’ online presence was reinforced, especially in social networks, with an increase in personalized advertising rates of 5%.

Even large stores are moving away from mass advertising, so users who have shown interest in certain products can find ads about that. Online advertising displaces traditional marketing not only because of the costs but also because of the two-way communication it offers with users. If we check Lidl’s networks, for example, we can see the communication between the brand and customers in the comments of their posts. The same happens with other brands such as B&M Stores and Home Bargains, the last one who usually makes giveaways among their followers to motivate them to get their products. The increase in online advertising has also increased by field, with education, groceries, and health is the most highly exploited areas.

The democratization of the Internet has made possible the adoption of e-commerce as a stable and globalized way of trading. The presence of online businesses and their interaction with users increased, but the number of financial service providers related to digital finance has skyrocketed. From online payment methods to providers and financing, the online finance ecosystem, which was already growing strongly, exploded in 2020; these financial services are steadily acquiring a larger presence, a clear example being the expansion in the use of digital wallets.

In countries with poor commercial infrastructure, this has been a groundbreaking improvement for the consumption possibilities of the population; in Brazil, an alternative platform helps people contact small merchants in their locality. It has also helped increase people’s shopping possibilities, not limited only by their local stores, allowing them to get better prices, variety of products and helping competition in the market.

Although the third quarter of 2020 saw a decline in e-commerce, it still shows a 30% increase over the same period in 2019, according to the U.S. Census Bureau. The question of whether E-commerce will still have a strong presence in 2021 seems to suggest that it will, although probably with a significant decline compared to 2020 due to the gradual normalization of commercial activity. Nevertheless, it is a process that changes from country to country, as well as people’s consumption patterns, so it is possible to estimate a positive development in general terms of e-commerce in 2021.

However, this decline should not be taken as a bad indicator for e-commerce, as 2020 was an extraordinary case; on the contrary, it should be compared with 2019 figures and appreciate the increase in annual growth and its impact categories of necessities. 2020 expanded e-commerce globally. There was a reshaping of shopper paradigms, many of whom now consider online shopping a strong option over traditional shopping, even for items such as medicine, personal care, and food.

The fact that large brands and franchises are increasingly integrating this model reinforces users’ confidence in adopting this purchasing modality in the long term. Among all factors considered, there are the sales percentages of major platforms and the integral development of the online finance ecosystem, how different financial models are integrated, and the interactions between users and brands. Everything seems to point to a future where finance and commercial exchange are increasingly heading towards the digital sphere.