In this article, we tell you about the situation in France after the “deconfinement” that took place on May 11th. If you would like to know more about the situation in the United States, here are 3 articles on this subject :
- Coronavirus pandemic in the US, Fedd regarding the economic consequences
- Coronavirus Live Updates, Live updates from the NewYork times, state by state
- How COVID-19 Is Transforming E-Commerce, key information about e-commerce sector
And more info about the situation in the UK :
- How Covid-19 affects U.K. businesses, by Practical Ecommerce
- The COVID-19 eCommerce Impact Data Hub, infography about e-commerce during this period
- COVID-19 situation update for the UK, economic consequences of covid
Based on the sector of activity, not all e-merchants are affected in the same way…
Depending on the industry, the post-COVID-19 impact on the business is not the same. Here is what Contentsquare found for the e-commerce sectors in France:
- Four sectors recorded a strong increase in traffic: Media (+46％), Retail (+42％), Pharmacy / Para pharmacy (+25％), and Telecom (+23％). These sectors are experiencing an upsurge in transactions with a high conversion rate.
- Six sectors noted a decrease in traffic: Jewellery / Watches (-25％), Travel (-22％), Luxury Goods (-19％), Retail Fashion (-14％), as well as the Events and Sports Equipment sectors (both at -13％). These sectors are very much affected by the Covid-19 crisis, they are noticing a fall in sales, which is leading to a sharp drop in the conversion rate.
With the health crisis, new purchasing behaviors have emerged
The Covid-19 crisis has caused an increase in the number of online purchases in the three largest e-commerce markets in Europe: France, Germany, and Great Britain. According to a study by Kantar, 9% of shoppers make more online purchases than before. This pandemic has therefore changed purchasing behaviors but has also confirmed certain habits that will continue in the future, as 6 out of 10 consumers indicate that they will continue to shop online after the end of the health crisis.
80% of consumers say they will start shopping online again for so-called “non-essential” items, particularly in fashion and household appliances for half of them. Even older people, who are usually fond of physical stores, say they want to continue to make online purchases post-confinement (Kantar study).
“In times of containment, consumers’ main concerns are about essential products, but the study reveals that all major e-commerce categories will not only bounce back at the end of the pandemic but will reach even higher levels than before.”
Joakim Gavelin, Founder of Detail Online
However, even if e-commerce activity is still maintained during the lockdown, some e-merchants have still lost valuable customers on their sites even though consumers are buying more online. With the gradual reopening of physical stores, whether an e-merchant with a physical store or not, it will be necessary to find customers quickly to restart the activity (read the article : 4 tips to boost your sales after the confinement).
What to expect after the deconfinement?
According to several economists, the economic recovery after deconfinement can take three different turns, more or less fast and strong:
The V-shaped recovery: the ideal scenario
This recovery demonstrates the idea that business activity will recover as quickly as the recession during “confinement”, boosted by support and stimulus schemes around the world. It will also imply a rapid return to normal health to prevent companies from insolvencies and massive lay-offs.
The U-shaped recovery: the lesser evil scenario (slow recovery)
After the decline in activity due to containment, the recovery will experience a “floor” period that could last until the end of the year, where the return to work will take a long time. With job losses and companies struggling to get back to work, it would take until the third quarter of 2021 for the economy to return to its pre-crisis level.
The W-shaped recovery: the relapse scenario (rapid recovery then relapse)
The W-shaped recovery is a “false recovery”, mainly related to a second wave of the coronavirus epidemic. After a short period of deconfinement and a temporary resumption of activity, confinement would resume and it would be necessary to wait until the 3rd quarter of 2021 to hope for a return to pre-crisis levels. The scenario is plausible and above all feared.
Whatever the recovery, four changes stand out for the post-confinement period in online consumption.
- Change n°1: Increased digital purchasing
Consumption habits have changed during this period of containment, and consumers will now make greater use of the web to purchase a product. This model of digitalized consumption is creating a wider gap and increasing the wealth of the main e-commerce players. As with physical stores, it is the best-known brands that are the most visited on the web and that continue to sell despite the crisis. The smaller, more fragile players in the e-commerce market are experiencing a difficult period with a long-term impact. This implies a more reactive approach on the part of e-merchants, who will have to continue their activity with a rise in demand on the digital channel.
To hope to survive over the long term, e-merchants must double their efforts and position themselves at the top of the Google rankings. It is therefore necessary to work on SEO to attract customers to its site. Those who are more reactive will take market share faster and will be the great survivors of this post-confinement period!
- Change n°2: Communication centered on people
E-commerce sites have implemented a conversational model relying on the involvement of personnel to respond to customers. With a growing number of requests, e-merchants now communicate more and more via their chat channel. To respond to customers, brands must be present on the site at all times. That is why the automation of the chat channel appears to be the best solution. In the form of a virtual agent, this solution responds to customer requests without in-humanizing the exchange. In case of complicated requests, the question is redirected to a human, which improves customer satisfaction.
The implementation of virtual agents on e-commerce sites has enabled merchants to stay present even during periods of confinement. As for customers, they are satisfied to have an answer to their questions in real-time. For post-confinement, this solution could become the means to better control customer support costs, improve service quality, build customer loyalty, and even improve conversion rates, with the virtual agent acting as a real sales assistant.
- Change n°3: A Return to Local Commerce
This period of health crisis highlighted the solidarity of the French towards local traders. Based on mutual aid, they were able to continue selling and thus perpetuate their brand. The local trade was strengthened, leaving the place for French merchants to sell their products to the disadvantage of international products. It is no longer a question of free trade on a planetary scale, but of regaining a form of strategic, economic, and social independence.
This local consumption responds to the ecological stakes and is possible thanks to digitalization. Indeed, local merchants present on the web have been able to promote their products, which are increasingly in demand by internet shoppers. France has thus regained its independence in terms of e-commerce sales thanks to local merchants.
- Change n°4: A personalized customer experience on the site
E-merchants have noticed that consumers appreciate being listened to and feeling special, especially in these times of confinement. This is why brands are enhancing their digital presence with a personalized shopping experience that strengthens customer relationships. This trend is forcing e-merchants to accompany customers to anticipate their needs and facilitate the act of buying. Here again, they are looking for a low-cost solution that can help them get back on track post-confinement.
To do this, the virtual agent on the chat channel is once again a useful and profitable solution to tailor the customer experience. On the website, the virtual agent plays the role of a sales advisor proposing to the customers the right products matching their expectations to encourage them to buy. This is a strong way to jump-start post-confinement sales.
- Change n°5: Artificial intelligence is on the rise
The Covid-19 has accelerated the need to centralize data to democratize connected objects, notably in the field of health. The deployment of artificial intelligence will bring about the emergence of new players in e-commerce, capable of marketing new intelligent products.
Thus, an entirely new world equipped with artificial intelligence for all consumers will further change consumer habits. For the moment, online objects remain expensive, but in a few years, they will be widely available, just like mobile phones today.
Conclusion
The e-commerce sector, affected by the Covid-19 crisis, will experience post-confinement developments. This article provides guidelines on how to be well-prepared for the expected consumption peak. Brands will have to implement an effective solution to meet these new demands. The changes expected after the de-confinement will also lead e-merchants to adapt to new purchasing behaviours, with more human-centered and digitalized communication. To respond to this, the automation of responses on the chat channel can help e-merchants to maintain their post-confinement activity.