Post-Covid E-Commerce Insights

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When the pandemic first hit, it completely disrupted our lives. There was a silver lining there though. When businesses started struggling to sustain themselves, many made the switch to e-commerce to survive. A lot of people who lost their jobs due to COVID-19 also went the same route and started their own online businesses. And, a good majority survived this economic push.

Now, almost two years later, even the e-commerce industry is suffering from the backlash of the COVID. The issues and challenges that are currently impacting the e-commerce industry are not much different than those affecting brick and mortar stores.

Some of those issues have been highlighted below:

Switch in the Buying Pattern

When lockdowns were first implemented, it forced people to switch their buying patterns and move towards online shopping to meet their needs. A year down the line the pattern had become somewhat permanent with new measures in place, like no more than a few people allowed in a store at a time, a large percentage of people refuse to go back to physical stores for shopping.

While this switch in the buying pattern did create great opportunities for online business owners, it also changed the e-commerce landscape permanently, as did COVID-19. As people have rushed to online shopping, e-commerce businesses have started to struggle for their existence in the post-COVID era, trying to meet the increasing demand of online consumers.

Affected Supply Chain

Lockdowns have affected production, which in turn affected the supply chain of a lot of consumer goods. And, it is not just the UK that has been affected by the disturbed supply chain or just the consumer goods. The impact is global. And, the shortage is noticeable. 

This shortage has also led to a price increase of many products, with higher transportation costs and a shortage of raw materials, making it hard for e-commerce businesses to match their own prices. Not to mention, the shortage has also caused a surge in orders as well.

Surge in Orders

Many e-commerce stores, especially those that deal in essential items, have been witnessing a surge in their orders as well. While a higher number of orders normally guarantee an increase in profits, in the current scenario, it’s costing e-commerce business customers and sales.

The problem here, again, is the disrupted supply chain. Many of the in-demand products have failed to meet the required supply for months now. So, if an e-commerce store only gets an inventory of ten items but has to cater twelve orders, it will definitely have to decline two customers, damaging its reputation.

Higher Competition

One post-COVID issue that is also damaging the sales of many online businesses is higher competition. Unemployment and lockdowns have driven business owners in hoards to the internet. In the first quarter of 2020 alone, more than 85,000 businesses were established online in the UK, according to Growth Intelligence. 

An increasing number of businesses automatically means higher competition. Also, with affected supply chain and surge in orders are already negatively impacting many online businesses, putting their reputation at risk. With dwindling reputation, businesses are also witnessing customers switching to competitors, risking profits. 

Investment in Online Presence

COVID-19 has completely altered consumer behavior. People now prefer online shopping a lot more than they used to. Maybe it’s because of less in-person interaction or due to the fear of contracting the virus. In any case, it has become vital for e-commerce businesses to invest in their digital marketing to develop and sustain their online presence.

This means increased expenses for even those running e-commerce stores from their homes. Raising expenditure is also become an issue for businesses also struggling to maintain their customer base and meet the ever-increasing demands with limited supply.

Operational Challenges

E-commerce businesses, especially small ones, are also facing additional operational challenges in the wake of COVID. Most people started their online business in desperation—out of unemployment or failing physical locations. And now, with everything that has happened as a ripple effect, it has become difficult for businesses to find warehouses to stock inventory or find a helping hand.

Yes, there are people still looking for employment, but small e-commerce startups don’t pay as much or find it hard to afford any hired help, leaving most businesses to be run as a one-man show. And, there’s only so much one person can do, reducing, if not eliminating their chances of growing the business.

Customer Experience Challenges

Another issue that e-commerce businesses seems to be struggling with, in the post-COVID times, is providing a good customer experience. The biggest problem behind this struggle is surging orders and the shrinking supply chain. While business owners have been finding it hard to meet their customers’ demands, it is even harder to convince their customers of the prevailing circumstances as a reason for their delayed deliveries or canceled orders.

As a result, social media is blowing up with negative reviews about countless online stores.

Store Pick up Option

This particular challenge isn’t exclusive to just an e-commerce business. Rather, it is a challenge for those following a hybrid model. BOPIS model specifically catered to customers who preferred interacting with the products to finalise their purchase decision. 

The intuitive BOPIS (buy online pick up in-store) model was well-received initially. But like the online sales, it also seems to be suffering post-COVID. Unfortunately, as business reopen their physical stores, the inventory struggles continue, making it hard for businesses to continue to follow BOPIS with their online sales, again, taking a hit on their bottom lines.

The few challenges presented above are just a fraction of the sufferings of e-commerce businesses post-COVID. These challenges and issues are common to all online businesses. However, the list can easily be much more diversified if the challenges were discussed specifically focusing on each of the e-commerce industries.

The purpose of this post is not to discourage anyone from entering the e-commerce market. But to help better plan your e-commerce business, the risks involved can be minimised.

We have been partnering with small businesses and E-retailers to help them stay connected with their customers 24/7 and with order fulfillment since 2008. 

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