The landscape of online retail has changed hugely, since the pandemic began in 2020. Now, as we somewhat learn to live with the virus, it’s interesting to look back on the past few years, and see how it’s changed the online retail industry.
The graph below shows growth rates for the years of 2019, 2020, and 2021, taken from IMRG’s digital dashboard. The data represents how much growth rates have been impacted by national lockdowns, and changing consumer attitudes. We can see that in 2019, growth was steady, and positive, as it climbed throughout the year. Pureplay retailers (those only selling online) saw +9.88% growth rate overall, whilst multichannel (those selling online and in stores) saw +7.47%. This is considered a relatively normal rate of growth for both types of retailer.
However when we look at 2020, when the pandemic reached the UK (the dashboard reflecting UK sales data), growth soared, as retail overall experience a huge boom, when lockdowns forced shoppers online. Much of this growth was within multichannel retail, as customers who were used to shopping in store were converted to the same online shops. Overall, 2020 saw +35% growth, which is completely unprecedented.
As shown in the steep decrease in the 2021 line, online retail plummeted in the second year of the pandemic, as the high street reopened in April. Although it may appear bad, growth was up at the beginning of the year, then dropped, as it could not sustain itself against the huge growth of the year before. Overall, 2021 saw +2.7% growth total, the lowest ever recorded by IMRG’s digital dashboard, for this reason.
YoY Percentage Revenue Growth Rate
The past two years have seen retailers adapt, and think quickly, and turbulent times have put their businesses into new situations—such as closing in-person stores, fluctuations in buying habits, or creating new products e.g. facemasks, or athleisure-wear. Many retailers expanded, and used this as an opportunity for growth, as there were many more customers online during the pandemic, therefore providing grounds for new growth, as shown in our graph. What it’s taught us, is that business strategy must be forever evolving, and reacting to the world at large. Whilst many retailers fell behind during this time, those who rose to the challenge, and saw these changes as a means for expansion have come out on top in 2022.
Overall, whilst there have been huge fluctuations, the market has grown hugely over the course of the pandemic. When comparing revenue growth from 2021 against 2019, there was a +39% increase, demonstrating the way in which online retail has thrived over this period.
