Creating Resillience
Pandemic Accelerates E-commerce Adoption | Implications for Industrial & Retail
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The ongoing pandemic, fueled by the COVID-19 virus, has had dramatic effects on the industrial and retail sectors, particularly e-commerce and omni-channel adoption. Though e-commerce’s share of total retail sales was steadily increasing prior to the onset of the pandemic in early 2020, social distancing and shelter-in-place mandates drastically accelerated the timeline.
E-commerce experienced an historical 34.2% surge in activity in 2020. EA expects that e-commerce growth will slow in 2021 but resume its long-term trend of gaining share in the retail space in outer years, approaching 35% by 2030 and settling at 40%, or more, by 2040. The strength of e-commerce should provide a tailwind for industrial demand over the next several years, though increased usage of omni-channel practices and increasing costs associated with e-commerce may dampen some of the benefits for the sector.
Though the pandemic helped drive demand in the industrial sector, it weighed on retail fundamentals. Depending on the good or service it provides, certain types of retail tenants will face more pressure from e-commerce and increased efforts will be necessary to accommodate consumers’ needs for convenience and differentiate the in-store experience. Service retailers will continue to be more protected from e-commerce adoption and will see traffic rebound when the pandemic eases.
Read more about the pandemic’s impact on industrial and retail fundamentals and forecasts in EA’s latest ViewPoint report.
E-commerce experienced an historical 34.2% surge in activity in 2020. EA expects that e-commerce growth will slow in 2021 but resume its long-term trend of gaining share in the retail space in outer years, approaching 35% by 2030 and settling at 40%, or more, by 2040. The strength of e-commerce should provide a tailwind for industrial demand over the next several years, though increased usage of omni-channel practices and increasing costs associated with e-commerce may dampen some of the benefits for the sector.
Though the pandemic helped drive demand in the industrial sector, it weighed on retail fundamentals. Depending on the good or service it provides, certain types of retail tenants will face more pressure from e-commerce and increased efforts will be necessary to accommodate consumers’ needs for convenience and differentiate the in-store experience. Service retailers will continue to be more protected from e-commerce adoption and will see traffic rebound when the pandemic eases.
Read more about the pandemic’s impact on industrial and retail fundamentals and forecasts in EA’s latest ViewPoint report.