Is E-commerce a Viable Business Avenue Post-COVID?

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As the pandemic peaked and stores closed their doors, e-commerce accelerated in growth to become a steady crutch for businesses (and people) to lean on during unprecedented times.

Global e-commerce sales rose to $26.7 trillion in 2020, which is equivalent to 19% of all retail sales. But while the recent success of e-commerce is clear, one question still lingers: is the online market set to remain a viable option–or will the high street make a post-COVID comeback?

E-commerce is a complex and broad industry with many benefits and risks that require careful consideration. In this article, we explore the viability of sustained e-commerce growth by assessing the following factors:

How COVID-19 has impacted the high street
Benefits of switching to an e-commerce business model
Risks associated with a typical e-commerce business model

Read on as we outline whether e-commerce is a viable business avenue post-COVID.

How COVID-19 Has Impacted the High Street

Since the global financial crisis of 2008, the high street (and brick and mortar retail) has been in steady decline. Deloitte–a multinational finance company–cites the web (among other headwinds) as a major reason for 1,400 retailers entering administration since 2010.

The pandemic has only served to accelerate this once steady decline. This put pressure on brick and mortar operations to find digital solutions to continue trading amongst sporadic lockdowns and social distancing measures.

This last year has also put e-commerce on trial, for which it has passed with flying colors. It has shown how the internet is capable of responding quickly to the void left behind by the high street. And it demonstrates a robust and convenient nature that has the foundation to become the most popular way people shop in the future.

With that being said, the typical high street offers more than just shopping. This is why it continues to survive despite the ever-growing threat from e-commerce. After all, the high street provides a greater sense of community and human interaction, something consumers cannot experience at the click of a mouse.

While e-commerce has certainly earned its stripes over the pandemic, there’s a sense that people are keen to get back to normal in a post-COVID world, That could threaten e-commerce as a viable business option. In the next few sections, we explore the benefits and threats to e-commerce and how this might affect your business aspirations.

Benefits of Switching to an E-commerce Business Model

Having an e-commerce business comes with many inherent advantages and benefits.

Here are some benefits of e-commerce that may convince your its a viable business avenue in a post-COVID world:

✅ E-commerce provides a 24/7 sales channel. Unlike brick & mortar stores, the doors of your e-commerce website never close. Customers have different shopping habits, some like to get in early; others crawl the web through the night. By being available all hours of the day, you can attract people who wouldn’t otherwise be able to visit your physical store.

✅ Store builders make online selling easy. E-commerce store builders such as Shopify and WooCommerce make e-commerce more convenient for the average business owner. This is because you don’t need to learn code or even have extensive knowledge on web design to turn your website into a valuable sales channel.

✅ Customers have a less invasive experience. Before the pandemic, some people liked to avoid the hustle and bustle of high street shopping. But, this is likely to become more common as people feel tentative about a sudden return to normality. E-commerce is simple and non-invasive. If people want to get in touch, they can use social media like Twitter, Instagram, and Facebook. Or, you can add a chatbot to resolve issues instantly.

Risks Associated with a Typical E-commerce Business Model

E-commerce offers your business greater flexibility and selling potential. However, no opportunity comes without risk, and online selling is certainly no expedition to the rule.

Here are some risks associated with a typical e-commerce business model that you should take into account before deciding it’s a viable avenue for your operation:

❌ Friendly fraud is losing sales for online businesses. Otherwise known as chargeback abuse, this refers to a refund initiated by the cardholder or their bank. On the face of things, chargebacks are completely legal and often occur for a valid reason (merchant error or buyers’ remorse). Done excessively, however, it can have a devastating effect on your business, with friendly fraud projected to have cost businesses $50 billion in 2020.

❌ Customers cannot try products before they buy. Augmented reality software is one thing, but it may never quite beat going into a store to try before you buy. In its current form e-commerce simply isn’t interactive enough, which can put off many prospective buyers from looking at your products or services.

❌ E-commerce is highly competitive (and tough to get right). There are 576,000 new websites created every day. This a staggering number that underpins the difficulty your business faces to be visible in the SERPs. Purchasing Google Ads is one way to stand out amongst your competitors. But to truly increase traffic, you’ll also need to invest time and effort into growing your online presence organically with search engine optimization.

Summary: Is E-commerce Viable Post-COVID?

Despite the rapid growth of ecommerce and the decline experienced on the high street, physical retail remains more popular than its digital counterpart–but for how long?

The pandemic handed e-commerce a big boost in growth, though this industry has been trending in an upward direction for a long time now. There’s lots of potential in e-commerce and we haven’t even scratched the surface yet.

E-commerce offers your business a sense of flexibility and outreach the high street simply cannot match. But it’s not without risk. The digital market is a competitive environment that forces you to work hard just to be seen.