Amazon and online stores have regained their pre-pandemic market share

The bet on a lasting change in shopping habits linked to the pandemic of large online store companies such as Amazon, Wayfair or Shopify seems to be losing. According to a report, published on October 14, 2022, by the United States Census Bureau (USC), the equivalent of INSEE, the latest financial results of e-commerce giants in the United States show that consumers have resumed their old habits.

Has the pandemic transformed consumers?

At the height of the pandemic in 2020, buyers flocked to the internet. The market jumped in a quarter. Usually between 2010 and 2020, e-commerce growth was 1% per year in the United States. During confinement, it jumped from 11.9% to 16.4% according to the Census Bureau. E-commerce companies then invested in the belief that a large proportion of customers were abandoning physical stores.

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However, since the reopening of commercial spaces, buyers have started to resume their habits and consume less on the internet. For example, online apparel sales growth has returned to pre-crisis levels according to USC. Companies like Shopify find themselves in decline and are forced to lay off more than 1,000 people to compensate for their losses on their investments. Amazon’s stock value fell 32%. Shopify’s share price plunged 80%, for a loss of $143 billion.

A study of 10 of the largest U.S. chain stores shows store visits are up 2.7% this year through August compared to the same period in 2019, according to analytics firm . In addition, according to specialists, for many people, shopping in a store is a pleasure. Going to the mall offers more than just making an online purchase. The experience can awaken the senses and provide the social interactions that humans crave.

E-tailers are defending themselves with the recent rise in inflation. According to them, consumers are becoming more and more cautious about spending on their platform. Moreover, they are not all impacted by this drop. U.S. online grocery store penetration reached 2.8% in the second quarter, nearly tripling its share over the same period in 2019, according to financial services firm UBS.

Is the whole world affected by this drop in spending on online stores?

The financial results of e-commerce across the globe are disparate. The market is now mature in the West, it is evolving with small variations. E-commerce companies are adapting and suffering big losses. In particular, in Europe, where ASOS and Bouhou have lost 70% of their value. The e-commerce giant, Amazon, has also suffered losses of more than one billion euros over the past two years in Europe.

On the other hand, e-commerce struggled to develop in emerging countries at first. But since the inauguration of new means of payment in installments, online platforms are progressing.

Asked by Bloomberg, Wayfair and Amazon declined to comment on this. As for Shopify, the company does not seem worried and wants to return to its base of physical stores that need the platform to develop on the web. Amazon will be able to move towards these GO stores to anchor itself in customer habits.

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