September 2020 Ecommerce Trend Analysis: Omnichannel Is Here to Stay

Newel Cobb

September 16, 2020

It’s incredible how quickly ecommerce has evolved in just a few weeks. Last month we reported that COVID-19 has pushed ecommerce forward by a whopping 10 years and changed the way key consumers shop. This month we’re seeing exciting updates about how big brands are adapting to these changes and making the playing field more competitive. Let’s talk about it.

Brick-and-mortar Q2 earnings are out, and they’re killing it

Walmart’s U.S. ecommerce sales grew 97% in the second quarter with a 9.3% growth in brick and mortar same-store sales, due in no small part to their grocery services, which have been thriving during COVID-19. Target has done even better: the retail giant saw 60% growth in in-store pickup, 700% growth in drive-in pickup, and an incredible 195% growth in digital sales. Target reports that 92% of their Q2 growth (dotcom and brick-and-mortar) involved a brick-and-mortar location.

US Ecommerce Growth Q2 2020 | Pattern via MarketplacePulse
Screenshot via MarketplacePulse

Similar trends can be seen in the home improvement sector, which has grown robust with consumers spending more time at home. Chain Store Age reports that Lowe’s Q2 same-store sales rose 35.1%, and the Home Depot pulled better-than-expected numbers.

According to CSA, this year marks the first time The Home Depot has posted double-digit comps in seven years, and about 60% of customers’ online orders are being picked up in-store.

More and more retailers are integrating their supply chain, delivery, and ecommerce with their brick-and-mortar stores, and it’s paying off. U.S. ecommerce grew 44.5% in the second quarter—the fastest it's grown in over two decades—and big-box retailers who incorporated curbside pickup and delivery with their dotcom sales grew the fastest.

While we saw a big push for online groceries at the start of the year, we expect to see more brands leveraging their stores as warehouses where customers can purchase products across all categories.

Omnichannel is diversifying

Last month, we predicted that Kroger was cueing up to enter the omnichannel space. Sure enough, Kroger Co. announced mid-August that they’re launching their own dotcom marketplace that will be open to third-party vendors. Kroger is expected “to offer tens of thousands of additional goods, including housewares and toys,” Bloomberg reports.

Kroger isn’t the only company that’s diversifying the omnichannel space. Best Buy announced last month that they’re piloting a new ship-from-store model (similar to that of Walmart and Target) where 250 of their brick-and-mortar locations will be remodeled as “hubs” to ship out more online orders.

More retailers are realizing that to go into the retail war without a dotcom is like trying to win a boxing match without your right or left hand. We expect even more brands to be entering the omnichannel space in the near future.

DoorDash and Uber are pivoting to grocery

Omnichannel is growing so rapidly that brands like Uber and DoorDash, which are not traditionally grocery, are pivoting to dotcom brick-and-mortar pickup to keep up. DoorDash recently entered the on-demand grocery delivery space with its new DashPass service, which allows customers to place orders with participating grocery retailers (i.e. Albertson’s and Walmart) at DoorDash.com or on the app and have their groceries delivered directly to their homes without the need for scheduling.

Uber has seen its food delivery service Uber Eats outpace its core ride-hailing division in growth this year, and they, too, are looking to shift toward that space, showing how lucrative a market it is.

Walmart is making big leaps and changes

Walmart is one of the biggest brands to watch in the grocery pickup space. Last month, Walmart partnered with Instacart to offer same-day delivery in a few U.S. markets, positioning it as a top competitor to Amazon and Whole Foods. Walmart has been in active talks with Uber and Uber-like companies for years to transition to grocery delivery, and this new partnership with Instacart has closed the last mile for Walmart in a way that Amazon has yet to achieve.

Walmart has already overtaken Amazon in the grocery market share by transaction count, according to the TABS Analytics’ 8th Annual Food and Beverage Consumables Study. Walmart snagged a 30% share of online food and beverage transactions this year, pushing it ahead of Amazon for the first time in the study.

Another big thing to watch from Walmart is their platform Walmart+, which just went live this month. Walmart+ is a membership service offering free, unlimited-same day delivery on groceries, fuel discounts, and access to Walmart’s new Scan & Go service for $98 a year. While Walmart claims Walmart+ is not an Amazon Prime rival, its same-day delivery services and cheaper yearly subscription may prove to be a force to reckon with for Amazon.

The biggest surprise coming from Walmart this month is that they’ve teamed up with Microsoft in a joint bid to acquire TikTok. Ecommerce giants are increasingly looking to video streaming as a powerful force in online retail, and Walmart appears driven to get ahead of the trend. It also signals Walmart’s desire to reach younger consumers and make them comfortable with the brand.

Amazon will not be left behind

While Walmart is making big gains in the ecommerce space, Amazon is coming in swinging. Last month we learned Amazon is in talks with Simon Property Group Inc., the biggest mall owner in the United States, to convert anchor department store spaces (former J.C. Penney’s and Sears) into Amazon fulfillment centers. We predict many of these mall locations may house Amazon’s newest grocery label Fresh in an attempt to close the last mile in grocery pickup services and compete with Walmart.

Amazon Fresh stores will streamline the grocery shopping experience with features like Alexa aisle navigation and the Amazon Dash Cart, which allows customers to skip the checkout line and purchase their items simply by placing in their cart. It’s evident Amazon is working hard to increase their presence in the grocery space.

Meanwhile, Amazon’s dotcom offerings continue to expand. ShipMatrix reports Amazon shipped 66% of its own packages in July compared to 61% between April and June. It’s estimated they’ll potentially reach 80% by next year, giving Amazon a logistical edge to companies like Walmart that have yet to incorporate self-shipping.

Ecommerce growth is great right now, but many fear it won’t last

Retailers are reporting some of the biggest ecommerce gains in their history—Best Buy, for example, saw online sales grow by 242% during Q2—but there are concerns that when the pandemic comes to an end, the bubble will burst.

Walmart and Target largely attributed boosts in online sales to the 160 million stimulus checks distributed during COVID-19. Without the passage of a second stimulus, retailers like Walmart believe their sales will drop (they’ve already seen sales decrease as checks have tapered out).

That said, we’ve hit the point of no return for ecommerce

Ecommerce is a thing of the now, not the future, and its target demographic is growing along with the brands using it.

One example is baby boomers. Pre-COVID, boomers made less than 50% of their purchases online. Now 2/3 buy online via in-store pickup or curbside pickup, and more than 1/4 use Amazon Prime or another ecommerce delivery service. The biggest reason is convenience. Boomers are expected to continue using ecommerce long after the pandemic ends, giving brands one more reason to invest in it.

How will the holidays be affected this year?

UPS and USPS shipping rates are expected to increase later this fall as the pandemic stretches onward, but more customers than ever are anticipated to make online purchases. 44% plan on shopping online more during this year’s Black Friday, Cyber Monday, and Christmas holidays compared to last year’s holiday season. Fluent projects we’ll see a 73% increase in those who shop exclusively online.

The biggest takeaway from the last few months is that ecommerce isn’t just a phase for the U.S. economy. It’s here to stay. If your brand isn’t already looking at omnichannel and dotcom sales, yesterday was the time to get on top of it.

Reach out to us today to get a free demo of our services and see how Pattern can help you launch a successful omnichannel ecommerce strategy.

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Sept 6, 2022

Global Ecommerce Weekly News: 6th September 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon announces new inventory and distribution service, AWD Amazon has launched Amazon Warehousing and Distribution (AWD), providing inventory and distribution services to its sellers as a means of addressing current supply chain issues. AWD is now available for sellers using Fulfilment by Amazon (FBA), i.e. outsourcing their fulfilment to the platform. Amazon has plans to expand the service outside the platform in 2023. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/02/amazon-introduces-new-service-to-help-solve-supply-chain-challenges/) Amazon Web Services (AWS) launches in the UAE AWS, Amazon’s cloud-computing platform offering, has launched its second region in the Middle East and now provides its services in the UAE. The move will now allow anyone in the UAE who utilises cloud technologies to harness AWS’s advanced platforms and APIs. An estimated $11 billion USD is expected to be added to the UAE’s GDP thanks to the implementation, with an average of 6,000 external vendor jobs to be created annually. AWS is now available in 87 zones across 27 regions, with sights set on expanding further across Australia, Canada, India, Israel, New Zealand, Spain, and Switzerland. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/30/amazon-web-services-launches-region-in-uae/) --- Other Marketplace News --- Lazada to launch in Europe Alibaba-owned ecommerce platform Lazada is set to launch in Europe, marking a refreshed internationalisation push from the company. The move follows toughening economic conditions and performance in Southeast Asia, advancing the need to tap overseas markets. In Europe, Lazada will face tough competition from giants like Amazon and Zalando. Lazada’s exact entry strategy is to be confirmed and will be reliant on macroeconomic and market conditions, according to Lazada CEO James Dong. [Read more on DigitalCommerce360](https://www.digitalcommerce360.com/2022/09/01/alibabas-lazada-to-take-on-amazon-zalando-in-europe-push/) Chinese ecommerce giant Pinduoduo to launch cross-border platform in the United States Pinduoduo, a Chinese ecommerce giant rivalling Alibaba and JD, has announced it will be launching a new cross-border ecommerce platform. The marketplace is set to launch in the United States next month, as part of the company’s larger push into new markets. Pinduoduo found success in China thanks to its rock-bottom price offerings and harnessing of social commerce marketing, emulating strategies similar to fast-fashion giant Shein. [Read more on Yahoo Finance](https://uk.finance.yahoo.com/news/pinduoduo-launch-international-e-commerce-034129263.html) Alibaba launches its biggest B2B sales event, ‘Super September’ China ecommerce giant, Alibaba, has now launched its month-long B2B sales event ‘Super September’. The event provides 40 million buyers and 200,000 suppliers with the ability to connect on the platform, showcasing a ‘virtually unlimited’ number of products. The event hopes to foster new cross-border business relationships to tackle supply chain challenges currently faced by businesses. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/01/alibaba-launches-super-september-b2b-sales-event/) --- Other Ecommerce News --- Klarna’s losses quadruple in first half of 2022 BNPL provider, Klarna, has reported losses of $581 million USD for the first half of 2022. This figure is almost four times larger than a year earlier, where $129 million USD in losses were reported. The company attributes the losses to employee costs, technology investments, and rising credit losses. Klarna’s figure reporting comes amidst worsening economic conditions, fresh legal and regulatory scrutiny, and pressure from Big Tech competitors. [Read more on The Financial Times](https://www.ft.com/content/483451db-9221-4ca4-83a6-b4ddc6bfcfbb) [Read more on the Guardian](https://www.theguardian.com/business/2022/aug/31/klarna-losses-more-than-triple-as-consumer-spending-slows) One fifth of Snap employees to be laid off amidst poor financial performance Social media platform Snap (‘Snapchat’) has announced it will be laying off 20% of its employees and closing out a number of projects following a year of poor financial results.The move will see 1,200 employees globally lose their jobs, saving the company an estimated $500 million USD in costs. Snap is currently valued at $20 billion, an 84% decrease from its valuation of $130 billion last year. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/01/snap-to-lay-off-20-of-its-workforce-and-wind-down-a-number-of-projects/)
Aug 30, 2022

Global Ecommerce Weekly News: 30th August 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon set to shut down Amazon Care Amazon is closing its telehealth service, Amazon Care, which launched in 2019 as a trial program for its headquartered employees. Later the service was rolled out nationwide for employees and other companies. The ecommerce giant has now made the decision to move away from the healthcare space, believing it was not the right long-term solution for its enterprise customers. [Read more on CNBC](https://www.cnbc.com/2022/08/24/amazon-is-shutting-down-amazon-care-telehealth-service.html) Peloton closes new deal to sell on Amazon Following a recent deal, Amazon customers will soon be able to buy Peloton fitness equipment on the marketplace, marking Peleton’s first move outside a direct-to-consumer model. According to Peloton’s CCO, there are already around half a million searches on Amazon for Peloton products every month, despite having no presence on the marketplace. Some key products include the original Peloton Bike, retailing for $1,445 and Peloton Guide for $295. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/24/peloton-strikes-deal-to-sell-fitness-equipment-on-amazon/) --- Other Marketplace News --- 60% of Malaysians are buying from local sellers on Shopee A recent survey of nearly 3,500 respondents found that nearly half of the shoppers prefer to purchase from local sellers due to shorter delivery times. Other shoppers decide to shop locally due to the quality of the products made in Malaysia and an interest in keeping the economy running. As a result, smaller local merchants have been able to grow their businesses, and shoppers benefit from shorter delivery times, products of high quality and supporting local businesses. [Read more on The Malaysian Reserve](https://themalaysianreserve.com/2022/08/25/around-60-malaysians-are-buying-from-local-sellers-on-shopee/) Flipkart’s social commerce platform Shopsy crosses 100 million users Flipkart launched a social commerce arm, Shopsy, in July of last year, which has now surpassed 100 million users, ahead of its target timeline being the end of 2022. This acquisition of new users has made Shopsy one of the largest platforms of its kind in the country, and is expected to onboard a further 100 million by the end of 2023. The platform is centred around boosting local entrepreneurship and powering ecommerce for consumers across tier 2+ regions where users face challenges around trust and navigation when shopping online. [Read more on Business Standard](https://www.business-standard.com/article/companies/flipkart-s-social-commerce-platform-shopsy-hits-100-million-users-1220828006851.html) Meta joins Amazon and Walmart in bid for Indian ecommerce market Amazon mentioned earlier in the year that it would be building a logistics division in-house through its purchase of a 51% stake in Ecom Express, an end-to-end logistics firm, to make ecommerce deliveries more efficient in the country. Walmart operates Flipkart in India and is set to continue its investment in the marketplace. In an effort to compete in the Indian ecommerce market, Meta has partnered with Indian ecommerce company, JioMart, to offer customers a grocery shopping platform within its WhatsApp chat feature. [Read more on Pymnts](https://www.pymnts.com/news/retail/2022/meta-joins-amazon-walmart-indian-ecommerce-market/) --- Other Ecommerce News --- Ecommerce in Spain worth €57.7 billion in 2021 Spanish ecommerce saw 11.7% growth compared to last year, largely attributed to cross-border sales. In the final quarter of 2021, ecommerce sales in Spain were at €16.9 billion euros, at least 60% of which came from cross-border sales. Transactions from foreign locations to Spain generated a turnover of €1.56 billion in Q4, a growth of 27.7% compared to Q4 a year before. [Read more on Ecommerce News](https://ecommercenews.eu/ecommerce-in-spain-was-worth-e57-7-billion-in-2021/)
Aug 23, 2022

Global Ecommerce Weekly News: 23rd August 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon to add mental health support to primary-care service Amazon is set to move into mental health therapy with its primary-care division, following its recent acquisition deal of One Medical. The plan is to partner with virtual behavioural therapy service, Ginger, to offer its Amazon Care users with on-demand access to mental health services, licensed therapists and psychiatrists. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/11/amazon-plans-to-add-mental-health-support-to-primary-care-service/) GMB union calls for £15 an hour minimum pay at UK Amazon warehouses Amazon recently offered its warehouse workers a 3% pay rise, which in comparison to the June inflation rate of 9.4% left employees disappointed. Following this, hundreds of Amazon warehouse workers stopped work last week, protesting against the minimal pay increase, seeking a minimum of £15 an hour. Recent protests consisting of employee walkouts and sit-ins aim to get a better offer out of Amazon. [Read more on The Guardian](https://www.theguardian.com/technology/2022/aug/09/gmb-calls-for-15-an-hour-minimum-pay-at-amazon-warehouses-in-uk) Amazon third-party sellers have received their first-ever holiday fee hike Amazon’s third-party marketplaces account for close to half of the company’s online sales. The company introduced a 5% fuel and inflation charge to its third-party sellers earlier this year, and has now implemented another inflation increase charge. Commencing 14 October, any seller who uses Amazon’s fulfilment service is subject to the price hike, which is set to be an additional 35 cents per item for products sold in the US and Canada. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/17/amazon-third-party-sellers-have-received-their-first-ever-holiday-fee-hike/) Amazon puts a pause on UK grocery shop roll-out as the cost of living increases Amazon has slowed down on its UK roll-out of till-free Amazon Fresh grocery stores following disappointing sales and the rise in cost of living. Allegedly, the company is no longer looking for potential sites to expand and if more stores are opened, they will likely no longer use a till-free system, as consumers become more cautious about spending. [Read more on The Telegraph](https://www.telegraph.co.uk/business/2022/08/21/amazon-pauses-uk-grocery-shop-roll-out-following-disappointing/) --- Other Marketplace News --- Shopee overtakes Alibaba across international markets Shopee has surpassed Alibaba and taken the top spot for sales outside of China. Singapore-based marketplace saw a year-on-year increase of 51.4% at the end of Q2 of this year, while Alibaba saw a 3% drop during the same time period. This can be seen as a promising development for start-ups and their ability to compete with some of the largest ecommerce giants in the market. [Read more on Exchange Wire](https://www.exchangewire.com/blog/2022/08/18/shopee-surpasses-alibaba-in-international-sales-amazon-searches-for-entertainment-exec/) H&M reopens its official store to Alibaba’s Tmall ecommerce platform It has been nearly 18 months since Alibaba removed H&M from its Tmall platform, following H&M’s criticism of human rights abuses in Xinjiang. It is estimated that over a million people, predominantly minorities in the area, have been unlawfully detained in camps across the city. Brands including Nike, Adidas, Burberry and Converse were swept up in the controversy, however H&M was one of the first to be targeted for speaking out about the issue. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/16/hm-returns-to-alibabas-tmall-platform-16-months-after-xinjiang-controversy/) Klarna launches new feature allowing UK consumers to view full online order history Buy-now-pay-later company, Klarna, has launched a new feature on its shopping app, which allows UK consumers to view their full online order history, regardless of whether they purchased the product using Klarna. The feature also shows delivery tracking and aids consumers in managing their online purchases more conveniently. [Read more on The Industry](https://www.theindustry.fashion/klarna-launches-new-feature-allowing-uk-consumers-to-view-full-online-order-history/) --- Other Ecommerce News --- Online marketplaces responsible for £280 billion business turnover in the UK Nearly 900,000 UK businesses are currently selling on online marketplaces, generating an estimated £282 billion worth of sales each year. This figure represents 6% of the UK’s annual business turnover, highlighting the notable contribution that marketplaces make to the UK economy, along with the potential for further growth in this area. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/09/online-marketplaces-responsible-for-280-billion-business-turnover-in-uk/)