Effects of Global Pandemic on Digital Businesses

So far this week, we’ve discussed how digital technologies have changed industries, business performance and enterprises. The digital business landscape is still rapidly evolving and managers and decision makers need to be able to respond to emerging issues and challenges.

Over the next few steps, we’ll discuss three contemporary issues that impact on digital business and e-commerce:

• The covid-19 pandemic, which has forced all industries and sectors to move to a new business model
• Security issues that threaten e-commerce performance and reliability
• Social media and the emerging opportunities it presents for business growth

Pandemic

Covid-19 has significantly changed the behaviour of consumers and the competitive landscape for businesses. Consumers of all industries are experiencing severe financial uncertainty, which presents a challenge for businesses and companies whose ‘cost structures rely on their ability to command a price premium’ (Knowles et al, 2020).

Covid-19 offers opportunities for new e-commerce brands that can meet changing customer needs and provide more economic products or services. There are a number of factors that will influence a consumer’s decision to purchase from a new brand/company, from value and convenience, to availability, quality and purpose.

This diagram taken from a report by McKinsey & Co (2020) demonstrates the importance of these factors in different countries.

While it is estimated that e-commerce has grown by nearly 20% in 2020 (World Economic Forum, 2020), not all industries have shifted to e-commerce. The following diagram, adapted from Common Thread Collective (2020), shows data on e-commerce shopping behaviour during COVID.

Your task

What do you think the future holds for digital business and e-commerce as a result of the current COVID-19 pandemic? Share your thoughts below.

References

_{Knowles, J., Richard, E., Lynch, P., & Dollens, J. (2020, May 5). Growth opportunities for brands during the COVID-19 crisis. MIT Sloan Management Review. Web link}

_{McKinsey. (2020, October 26). Consumer sentiment and behavior continue to reflect the uncertainty of the COVID-19 crisis. Web link}

_{Orendorff, A. (2020, December 9). Coronavirus ecommerce trends, data & strategies: online shopping in the age of COVID-19 [Updated]. Common Thread Collective. Web link}

_{World Economic Forum (2020). COVID-19 pandemic accelerated shift to e-commerce by 5 years, new report says. Web link}