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E-commerce drives high growth in 60% of companies in the sector

Third-party online marketplaces have performed better than e-commerce companies, according to an analysis by the United Nations Conference on Trade and Development (UNCTAD) released Monday.

Simply put, fully digital business models have been more resilient to the current crisis.

In terms of sales trends, e-commerce companies have mostly experienced declines in sales, while nearly 60% of third-party markets have seen increases.

In addition, half of the third-party markets surveyed added new sellers to their websites.

About 60% of third-party markets experienced an increase in the number of buyers.

Electronic commerce

The pandemic has accentuated the trend towards greater adoption of social networks and the growth of sales through e-commerce websites.

Changes in consumer habits have also been observed, driven by the need to stock up on essential items.

Social media and proprietary e-commerce stores are important sales channels for e-commerce businesses.

Both channels have experienced greater growth since the beginning of the Covid-19 crisis.

The Covid-19 crisis has been associated with a change in the composition of sales of more than 65% of them.

In addition, according to UNCTAD, a survey confirms that more customers have gone online to search for essential products.

Grocery, pharmaceuticals, health and hygiene products, restaurant delivery, as well as financial services, are the sales categories that saw the largest increases in the Covid-19 crisis through third-party online marketplaces.

Mobile money

Electronic payments have seen rapid growth, but cash on delivery remains prominent.

Changes in consumer habits have been accompanied by faster adoption of cashless payment methods.

Almost 60% of e-commerce companies and 70% of online third-party marketplaces are experiencing relatively higher growth rates in mobile money payments, followed by transactions via electronic banking and credit cards.

However, as cash on delivery remains prominent in absolute terms, particularly in Least Developed Countries, it has continued to grow since the outbreak of the pandemic as consumers have increasingly turned to e-commerce.

While the pandemic has been an opportunity for many digitally-driven business models, the business prospects appear challenging for a significant portion of e-commerce businesses.

The Covid-19 crisis has negatively affected the costs of 66% of the sample participants.

About 56% of those surveyed reported that their workforce has been stable so far or could even increase in the short term.

Still, a high proportion (44%) of those surveyed have had to downsize their corporate workforce.

 

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