How Coronavirus Is Impacting E-commerce?
I hope you and your loved ones are doing well in this unfortunate case of coronavirus outbreak.
I hate to admit this, but I don’t think I would’ve cared as much if the coronavirus happened during my early 20’s.
For the first time, one can feel the global economy is in a pretty bad shape simply around your surroundings.
You can literally feel the pain of knowing so many other people are suffering out there. The physical toll is horrible, but the economic impact is...unprecedented. Multiple companies are forcing their employees to take a no-pay leave. Shopping malls and night entertainment outlets reported profits dropped drastically. The airports are empty – air flights grounded 96% of their flights. I can’t even imagine beginning to think about the restaurant industry. This is as if Thanos snapped his finger and killed half the economy.
The bill for saving the world economy is $7 trillion and still rising.
There will be more black swans in the future, and I hope we're all more prepared for the next one. This isn't the first, but definitely not the last.
Meanwhile, I've been getting some emails and PMs from people asking how I think this will impact the e-commerce space.
Some quick thoughts: On the surface, it might seem that even though many people across the world are now avoiding the outdoors, e-commerce may actually do well in this unfortunate virus outbreak.
But it is not completely a bed of roses.
For physical products, most likely there are going to be supply and fulfillment issues due to labor and manpower issues.
Digital products might actually do well on the other hand.
The issue is in how digital products are being monetized. Most of them make sales such as selling logo designs, video creations, web developments, etc.
This is my take, but this coronavirus saga is going to spark a good number of people working from home or even use this opportunity in starting their own online business. Ad costs are definitely going down that's for sure. But yet, be prepared that conversion rates are also lowering as well. If people are losing their jobs or they are fearful of losing their jobs, then they're going to hoard their money and think twice or even thrice when they take out their credit card.
The good news is that we're already used to working from home. And in the digital space, we're much leaner in operational costs as compared to most traditional businesses. There's always opportunity in crisis. For example:
1. This is going to be a spark for working from home.
2. People will want supplements to boost their immune system.
3. Everyone realizes how important life insurance is.
All of these are opportunities. Think about the domino effects. This pandemic reveals a lot of inefficiencies and problems with our systems. Anyways, that's my opinion.
It’s tempting to use this quarantine period to binge Netflix dramas like Crash Landing on You(I know it's tempting) or catch up on your PS4 backlog. Don’t squander this opportunity.
Use this as a chance to learn as much as possible.