APR. 22, 2020
Every corner of the economy has been impacted by COVID-19 in one way or another. While some industries are taking a major hit, others are thriving and having their best months. Then there are some industries that are, surprisingly, not seeing much change at all, at least in terms of overall sales and revenue. As federal, state, and local governments respond to the virus, economy-affecting rules and regulations will likely change. While these trends are bound to shift, this is what we’re seeing right now in the e-commerce, financial, retail, restaurant, and travel sectors.
E-commerce Sales of Essential Items Are Skyrocketing
According to the Cleveland Research Company, e-commerce is doing well right now, especially when it comes to stores that sell essentials, including food, cleaning supplies, and medical supplies. However, the influx of orders for these types of products has backed up delivery dates. This gives some shops the opportunity to compete if they can deliver quicker than their competitors. Amazon is leading the e-commerce charge with its regular online shopping platforms: Amazon Fresh, its grocery delivery service, and Prime Now, the lightning-fast delivery service that gets packages to customers in two hours or less.
Unfortunately, for e-commerce sites that don’t sell essentials, sales have dropped as consumers limit or halt discretionary spending. On the other hand, with a captive audience that’s home, online, and bored a lot of the time, some non-essential e-commerce shops may continue to get orders simply because some people are shopping to pass the time. Moreover, if some retailers see that more people are window shopping, liking products and adding items to their carts without moving forward with purchases, they can plan powerful re-targeting strategies to encourage those people to buy at some point.
Financial Markets Decline and Banks Move Online
According to Statista, global financial markets have been greatly impacted by COVID-19 and have faced significant losses. Traders are selling and investors have stopped buying stocks. Overall, the market is in a serious downward trend. The outlook looks grim, as the economy is essentially shut down, and there’s no reliable timeline for returning to normal. While government relief funds have helped somewhat in terms of lifting or maintaining financial markets, investors are waiting until the outbreak is under better control to trust stocks again.
When it comes to the banking industry, banks are being forced to digitize and go completely remote so they can continue serving customers. While some big, well-known banks already offer the ability to bank online for 100% of transactions, smaller banks and credit unions haven’t needed to digitize to this degree – until now, at least.
Restaurants Have Changed How They Serve Customers
According to Eater, a decrease in visits to restaurants began even before they had to officially close, back when coronavirus-related deaths were just starting to climb. However, while reservations and dining have dropped, visits to fast-food restaurants and pizzerias have increased, as people remain comfortable with drive-thru, pickup, and delivery services. Overall, though, small independent restaurants are struggling even more than well-known chain restaurants, which is why there’s been such a societal push to continue supporting local businesses.
Restaurant closures and reductions in business are also impacting food distributors, as they’re receiving far fewer orders from restaurants (as well as events, offices, and schools). On the other hand, as more people are preparing meals at home, even though many restaurants are continuing to offer delivery and takeout services, grocery stores are seeing an increase in food and beverage sales. Grocery delivery services are becoming more popular, too.
Retailers Experience New Trends
There’s one obvious reason why retail is taking such a hard hit during the pandemic: non-essential stores have had to close, and foot traffic has completely disappeared. Wholesale business is also being negatively affected, particularly when it comes to order cancellations or reductions for apparel and beauty products.
However, retailers that sell essential items, like Target, for example, are doing well, especially if they have an online ordering and delivery component. Club stores, like Costco, are leading the charge, outpacing large companies when it comes to cleaning and food products. While general merchandise is not selling in these stores as much as before, the uptick in sales of essentials is so great that it’s more than made up for it.
Consumer electronics retailers, such as Best Buy, are being impacted in an interesting way. On the one hand, there’s been an increase in sales of work from home essentials, like keyboards and monitors. On the other hand, though, discretionary spending has gone down.
Specialty retailers are also seeing interesting trends. Stores like Dick’s Sporting Goods have seen an increase in sales in certain product categories, like camping gear, survival gear, and fitness equipment. If youth and professional sports seasons continue to be closed for the next several months, though, sales of related items are expected to plummet.
The Travel Industry Is at a Standstill
Demand for travel-related products and services has decreased around the globe. Travel agencies are one of many sectors impacted by COVID-19, and while they’re currently continuing to work to process trip cancellations, that’s bound to slow down at some point. Hotels are seeing far fewer reservations, too. At first, there were fewer corporate and group reservations, but that’s expanded into cancellations of leisure trips, particularly around Spring Break.
While airlines are continuing to operate, though with far fewer flights and tickets sold than before, cruise lines have had to completely stop running. Bookings were canceled and are still on pause, and nobody is sure when booking will re-open, and when it does, how quickly the cruise sector will be able to rebound. Cruise lines have even halted advertising and marketing efforts for now.
Is your business struggling right now? We have an article about creative ways to keep your restaurant running during quarantine, plus this overview of how merchants can sell on the Google shopping page for free.
By Lindsay Pietroluongo
