The shift requires retailers to innovate new ways for serving customers as “a new retail landscape” of mobile shopping, flexible delivery, and pick-up options emerges. Many companies in this sector have never had physical stores. Dubbed digitally native vertical brands (DNVBs), they seek to disrupt traditional product categories and have hastened the decline of traditional high street retail that was underway even before spring 2020.
Laboure expects only a partial revival of fortunes for traditional retail as the pandemic’s impact recedes, with both American and European consumers growing accustomed to shopping online and signalling a more permanent shift as they use it for luxury goods in addition to everyday items.
Increased adoption of the internet and inflation are the tailwinds for increased demand, the report suggests. “In the future, all consumers will be digital natives,” explains Laboure. “They will be very comfortable with online shopping and further drive the demand for e-commerce options.” At the same time resurgent inflation and more expensive groceries are also driving consumers to actively compare prices, which can be done quickly and easily online.
Accompanying this is a shift from laptops to mobiles for e-commerce, with more than 80% of the world’s population now owning a smartphone against less than 50% as recently as 2016. “The ubiquity of mobile devices, including tablets, will continue to drive online retail sales,” predicts Laboure.
The grocery sector offers the biggest scope for further growth in e-commerce with more than US$1trn annual sales in the US alone, but online accounting for less than 5%. Although digital disruption has progressed slowly for several reasons – including consumers’ preference for seeing and touching products – the pandemic has boosted grocery e-commerce services.
