Marketplace Activity to 3rd May

Tuesday May 5, 2020 | Posted at 8:37 am | By Paul Dicken
May 5, 2020 @ 8:37 am

Earlier this month we looked at how the first week of April compared to the month of two halves, the most tumultuous month in ecommerce history, March 2020. In this post we review the month of April, to see what conclusions we can draw and forecasts we can make for the next few weeks and months.

Here are the figures week by week. You may recall that for comparison purposes we’ve taken a ‘same set’ group of established customers, so we can attribute as much of the weekly and year-on-year change as possible to the ‘Covid-19’ effect.

  • Week of 30th March, GMV was up 3% on the week before, and 97% up on the same week in 2019
  • Week of 6th April, GMV was down 16% on the week before, and up 63% on the same week in 2019
  • Week of 13th April, GMV was up 7% on the week before, and up 93% on the same week in 2019
  • Week of 20th April, GMV was up 11% on the week before, and up 69% on the same week in 2019
  • Week of 27th April, GMV was down 4% on the week before, and up 77% on the same week in 2019

So what do we make of these figures? The week of 30th March continued the dramatic growth of the second half of March, as the general public continued to stock up on day-to-day essentials in far greater numbers than we have seen, as well as higher value items to keep them equipped to work from home and entertained in the home and garden for the long haul they saw ahead of them.

The week of 6th April saw a dip by a sixth on the previous week, but still way ahead of the same week the year before. There are a couple of things to point out here. Firstly, the Easter weekend, accompanied by very good weather, fell during this week, whereas Easter was the 19th to 21st in 2019. Secondly, it appears the bulk of consumers may have invested by this time in their one-off rowing machines, pool tables, golf nets and garden items.

The week of 13th April then confounds that theory by rebounding 7% on the previous week, and almost doubling the online activity in the same period of 2019 which also included Easter.

The week of 20th April then grew again by a sizeable portion, with the week performing very strongly on the same week the year before. The week of the 27th April was slightly down on the week of the 20th April, and still way up on the same period in 2019.

We might speculate that the second half of March and early part of April saw profit-taking on the higher value items as sellers sold the stock they had and rushed to fulfill orders, before a second wave of growth began in mid-April, fuelled by the relentless need for essential foods and household items.

As the Prime Minister returns for work, and the number of Covid-19-related deaths climbs past 25,000, there will be much attention on the UK Government’s assessment of where it is in the outbreak curve, and when it can start signalling the relaxation of lockdown restrictions. Ministers and scientists will have one eye on the economy and the other on the health of the population and the risks of a second peak if they loosen the reins too early.

The degree of optimism after the election and the Brexit resolution – who thought that wouldn’t be topic 1 during 2020 at the beginning of the year? – seems to have dried up, to be replaced by what will be a drawn out period of pessimism as shoppers hunt for value deals.

At the same time, the 64-thousand-dollar question revolves around the long term buying habits of the population as a result of an enforced period of closed bricks and mortar outlets and shopping from home. The change management industry regularly exercises itself with studies on how long it takes for repeated new behaviours to become the accepted current behaviours.

Back in the 20th Century many people latched onto the notion that we cemented new behaviours after only 21 days. More recently, in 2009 a study in the UK found that the average period of adopting a new habit was 66 days. The emphasis here is on the word ‘average’, since the easier the new habit was, the quicker the new habit was formed. Indeed, the adoption range of new habits was between 18 and 254 days.

If we take the average figure, then by mid-to-end May – when it’s highly likely we’ll still be in a relatively constrained state – we’ll be past the 66-day period during which circumstances have restricted our social lives and our purchasing options. So, in the summer will we revert back to our pre-March working and shopping habits , as some believe, or will we continue to spend a larger portion of our time working remotely and a larger portion of our wallet online, as others believe?

Without a vaccine generally available before 2021, it seems that the answer lies somewhere between the two. We will use technology to bypass travel more often than we did, we will be more socially remote than we were, and we will shop online more often than we did. We’ll be behaviourally attuned to it, and we’ll still be conscious of our friends and family who are elderly or who suffer compromised health.

For many years, thought leaders have encouraged businesses to be where the customer is, and to provide the best possible buying experience regardless of the channel. Online, in its various forms of website, web store platform, and marketplaces, has for a long time been a key element of this multichannel approach, an approach which also spreads risk for the seller.

Many retailers have historically paid little more than lip service to the idea of a true multichannel offering, because it’s a big commitment and a big investment. Simply put, however, those sellers who have embraced online as part of multichannel are best placed for the balance of 2020 and into 2021, and those who haven’t are not.

If you’d like to discuss your ecommerce plans for Q3 and beyond, we encourage you to get in touch here.

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