The Covid-19 pandemic led to a massive surge in e-commerce usage. US e-commerce grew by 44% (around $861.12 billion) in 2020. In fact, 10 years of e-commerce growth happened in just 90 days during the pandemic. Whilst e-commerce has grown at unprecedented rates in the last year, overall retail sales fell by a record 1.9% in 2020.

However, with many countries across the world relaxing coronavirus restrictions, will online sales plummet whilst in-store retail benefits?

The pandemic caused an e-commerce boom!

Perhaps it goes without saying, but lockdowns and pleas from governments and health organisations to stay at home led to increased e-commerce usage. 9 out of 10 of the top global e-commerce companies saw double-digit revenue growth in 2020. Amazon topped this list with reported revenue of $386.1 billion. Wayfair, a home furnishings retailer saw a 55% year-on-year revenue increase whilst eBay saw an 18.9% rise in revenue. Online food retailer Ocado, released its half-year results for 2021 which saw a 22% increase in customers served. In general, stores with e-commerce websites saw their online revenue soar during the pandemic.

However, a major retailer that does not have an e-commerce site is Primark and this majorly affected its sales during the pandemic. Primark is reported to have taken a £3 billion hit to sales and lost £1 billion of profit in the last year due to the pandemic.

Will retail pick up after Covid-19?

The pandemic has introduced many more people to the convenience of online shopping, however many retailers are hoping that the easing of lockdown restrictions across the world will help in-store shops recover.

There is evidence that physical stores will still be popular post-pandemic. After the end of the first lockdown in Germany, shoppers rushed to visit reopened shops. In England, the reopening of non-essential retail in April 2021 led to massive queues outside several Primark stores. In fact, shoppers were so eager to shop at the store that Primark announced it would hand back £72 million in furlough payments to the government after record sales due to its reopening. Following a basket size increase (compared to pre-Covid levels) and shopper numbers bouncing back to 2019 rates at Primark stores, it is clear the consumers were excited to return to the high street.

Retailers will need to consider many factors if they want physical stores to be a success after the pandemic, such as their customers, brand, products, and store. Retailers must assess how their customers have evolved during and after the pandemic. For example, what are their priorities and behaviours now? The pandemic has led to millions of people being furloughed or even losing their jobs completely. By autumn 2021, the Bank of England expects the unemployment rate to jump to around 5.5%. Retailers will need to be mindful of this as consumers will be likely to seek out products that are better value-for-money.

In terms of their brand, retailers must reconsider what the purpose of their business is and how they can best serve customers in post-pandemic life. Additionally, it is important to look at their products and whether they serve consumers’ needs in the right way. For example, even as restrictions ease, consumers will still be wary about their well-being thus health and wellness product sales are likely to increase.

Lastly, retailers must be mindful of how to keep customers safe in-store. Whilst coronavirus restrictions are ending in England, many people will still suffer from shopping anxiety. Consumers will expect stores to be clean and sanitised as well as increased popularity for contactless payments. Some retailers in England will still encourage customers to wear facemasks after 19 July in order to ensure safety with their stores.

Will consumers ditch online shopping once the pandemic is over?

Some online retailers, including the fashion store, Mytheresa, have already anticipated that their sales will stall as restrictions ease and high streets open.

Whilst online retailers will probably experience a short-term decline in sales following the reopening of physical stores, it is unlikely that the end of the pandemic will mean that consumers will ditch e-commerce altogether. Globally, the e-commerce share of retail sales has been on the rise for the last five years and this trend is expected to continue even after the reopening of physical stores. The pandemic has introduced consumers to the convenience of online shopping and many will not give this up after the pandemic.


This is the second post in our Shopping after Covid-19 series. You can read the first post here and the next post here.