New research from Metapack highlights the impact of COVID-19 amid home working shift
German retailers are bracing for an additional €33.9 billion of online home deliveries by 2025 as a result of the pandemic, new research from ecommerce delivery technology leader Metapack in partnership with research consultancy Retail Economics reveals. This comes as online is expected to account for 32.3% of total non-food sales by 2025 amid persistent home working.
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Permanent shift online
Metapack’s new Ecommerce Delivery Benchmark report shows that 15.0% of German consumers now expect to permanently shift more of their shopping online on the back of new behaviours formed since the pandemic.
A new wave of ‘digital shifters’ (the consumer cohort permanently switching to shopping more online) is expected to support an additional €41.4 billion in online sales compared to a scenario where the pandemic had no impact on shopping behaviours. This acceleration online will lead to €33.9 billion of additional sales going through home deliveries alone by 2025, compared to a scenario where the pandemic had no impact.
However, the lasting impact of COVID-19 will not be felt equally across all retail categories. The research predicts that apparel, homewares and health & beauty will experience a greater permanent shift online, brought about by online discovery since the pandemic.
A consequence of the shift online is that a fifth (20.8%) of German consumers expect to visit physical stores less in the future.
Working from home disrupting retail
Disruption is being felt by consumers working from home – driving both an uplift in online spend and putting pressure on footfall to stores.
Around a fifth (18.9%) of German consumers work from home more since the pandemic, of which over a third (34.3%) expect to shop more online permanently, compared to just 13.8% of those whose place of work has not been impacted from the pandemic.
As more consumers work from home, it has boosted the success rate of first-time deliveries and opened a much larger number of possible delivery slots. By 2025, German home workers expect their proportion of online orders delivered to their home to rise by 9.5%, compared to an average of 8.1% among those that haven’t faced change in their work.
New wave of online shoppers demand speed
The report delves into key consumer types and reveals that the new wave of online shoppers is more demanding of speed of delivery when considering their most important factors when shopping online. Across the markets analysed, 37.5% of ‘digital shifters’ value speed ahead of convenience, cost and carbon footprint of deliveries.
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Duncan Licence, VP of Global Product at Metapack says: “Driven by the pandemic, online consumer shopping expectations have changed significantly over the last few years, and a lot of these changes are here to stay. Our new report takes a closer look at these developments and their lasting impact on both consumers and retailers. It is expected that, as home working becomes the norm for more and more people, their appetite for fast, convenient, and easy deliveries that fit their lifestyle, will continue to increase. Retailers have reached a crossroads, they need to diversify their delivery options and invest in the right infrastructure and technology to meet the new needs of their consumers or they will struggle to compete, especially as the shopping experience becomes synonymous with the delivery experience. The retail industry has evolved beyond bricks and mortar, it’s time to step into the age of ecommerce.”
Richard Lim, Chief Executive of Retail Economics says: “A permanent shift in consumer behaviour and vast investment across the ecommerce ecosystem has accelerated the shift to online. Structural changes in the labour market, with persistently higher levels of home working across households, has unlocked greater demand for home deliveries. Although the demand for speed will put pressure on supply chains, home workers have both a greater ability and greater willingness to pay for delivery and returns compared to average online shoppers, which is critical for profitability amid rising costs and elevated customer expectations.”