The Effects of COVID-19 on E-Commerce GMV — 2021 Update

This past year, we analyzed the effects of the then-emerging COVID-19 pandemic on e-commerce in a multi-part series using aggregate worldwide marketplaces gross product value (GMV) information from our platform. To outline last year, we started the year with regular year-over-year e-commerce growth rates until bulk shutdowns began mid-March. During the next several weeks, growth in categories like health and beauty started to burst while other more optional categories languished (who will forget the Great Toilet Paper Run of 2020). We saw a particularly significant spike in GMV around the time of the April stimulation in america for virtually every class, and e-commerce levels remained well over prior levels for the rest of 2020.

With the most recent stimulus payments starting a week, we thought it would be helpful to compare March and April in both 2020 and 2021 to observe the effects of the stimulation payments in both phases and the year-over-year e-commerce expansion in certain categories.

Before digging into the data, please note the following points:

  • This information is based on marketplaces GMV aggregated across our entire customer base worldwide and contrasts Mar 1 — Apr 30, 2020 against Mar 1 — Mar 22, 2021.
  • The information presented below highlights a subset of market categories. Since marketplaces have distinct category structures, the information is presented using categories which have been standardized by ChannelAdvisor.
  • This data isn’t a proxy for total e-commerce action or the performance of any individual company, such as ChannelAdvisor or any individual market.
  • The information shown below is based on a year-over-year contrast of monitoring 7-day GMV and is expressed as percentage increase, but with real numbers removed. The Y-axis scale differs on each graph.
  • All calculations are done in USD. International currencies are converted to USD using the conversion rate on the day of the order. These results aren’t normalized to account for varying exchange rates. Please note that volatility in a variety of currencies may slightly affect these trends.

Assessing 2021 (so far) to 2020, we see two main topics:

  • E-commerce remains strong across most categories — Statistics from the U.S. Census Bureau reveals the terrific leap forward for e-commerce in retail sales. But though we are getting nearer, the world is not quite back to normal yet. And, polls suggest that customers will retain new customs and expect to shop online over prior to the pandemic.
  • Math — Although customers continue to rely heavily on e-commerce, the jump in online shopping in 2020 was important, and now we do not anticipate the identical step-function increase in volume moving forward as we saw this past year, though we also do not expect volumes to revert to pre-pandemic levels . Growth rates are high so much in 2021 for categories which underperformed this time this past year and come back down to earth for groups which were outperforming in March 2020.

As we look at e-commerce growth by class, there are 3 different groups, as mentioned below. In the graphs below, the light orange rectangle represents approximate time of the 2021 stimulation payments and the light blue rectangle represents approximate time of the first 2020 stimulus payments.

Categories Originally Slowed by COVID but Booming (Originally ) In the 2021 Stimulus

Once the effect of COVID became prevalent in March 2020, growth rates declined in some optional categories, such as clothes, shoes,and accessories; watches and jewelry; mobile telephones and accessories; and automobile tools, components, and accessories. Because these categories are associated with being out of the home and on the move, even those that profited from the April 2020 stimulation did so less than classes that included items required to shelter at home. Nevertheless, in March 2021, our statistics show these classes significantly benefiting from this year’s stimulation both because of stronger demand and the first lull this past year.

Groups that Grew Quickly Due to COVID in March 2020

In 2020, the’health and beauty’ class was among the earliest to see year-over-year e-commerce growth increase significantly as consumers stocked up on hand washes, over-the-counter drugs, and vitamins/herbs beginning in late February. While online sales in this class have remained strong, it’s lapped the first period of explosive growth from 2020. Thus, we see the influence on the year-over-year growth rates in 2021 (mathematics!) .

Computers/tablets and media was another category that began to grow quickly in early March 2020 as customers started preparing to school and work from home. Again, we can observe that the growth rates in 2021 have dropped as a result of difficult comparisons to the high growth rates in 2020, in addition to well-documented supply chain limits affecting many businesses and categories. Because these things normally have useful lives measured in years, we might also be seeing some effect of need being pulled forward in 2020.

Categories that Grew During COVID and are Still Going Strong

Finally, there are different categories that grew considerably during COVID and over the span of 2020 and are still growing at strong prices. The house and garden category, as an instance, is broad and need within that class has changed over time. During the first days of the shutdown, we saw enormous growth in items like toilet paper, cleaning supplies and office furniture. As time passes, subcategories associated with home improvement strengthened.

Industrial and business and pet supplies are different categories where growth remains well over the 2020 rates. As we lap the peaks from 2020 in the coming weeks and months, it is possible that the year-over-year growth rates in those classes may soften even with sustained levels of e-commerce activity.

Conclusion

E-commerce penetration increased in 2020 by at least two to three years relative to the steady pace of growth we’d seen in the years before 2020. Survey results lead us to think that new online customs will adhere and e-commerce will stay strong. Present e-commerce growth rates within particular categories reflect current need, what was happening last year at the moment, and the timing of stimulation payments. As we lap peak growth periods from 2020, growth rates in 2021 could be slower in comparison with the enormous spikes we saw in 2020, which is to be expected.