Coronavirus Epidemic Changes E-commerce and Digital Marketing

The outbreak of the new coronavirus epidemic highlights the reality of changing consumer behavior in the digital age. The epidemic has a potential chance on the e-commerce and digital marketing industries.

From a broad economic perspective, the new coronavirus epidemic has had a huge impact on the stock market. Events such as the global health panic have caused widespread economic uncertainty, as can be seen from the stock market decline. London's FTSE 100 index has fallen sharply, and other European markets have experienced similar declines.

There will be other declines due to operational disruption and impact on the supply chain. According to Forbes, even large global companies are struggling. Apple cannot bring so many iPhones to the market, and Tesla has suspended its operations in China.

Uncertainty in advertising spend
The reduction in the supply of commodities may cause senior management to refund their advertising costs. If fewer products are brought to market, the company will not get more revenue from advertising. Considering the possibility of wasting advertising funds, advertising executives will naturally withdraw from investing in advertising.

The assumption made by the analysts is that the new coronavirus epidemic will be resolved around June, which is why they predict that ad spending will decline in the first half of this year, but they have not changed their estimates for the second half of 2020. Needham analysts reduced their expenses. Estimates for Facebook's advertising business in the first half of the year. The New York Times also reported that due to the uncertainty of the new coronavirus epidemic, its advertising business growth has slowed.

Marketing activities are cancelled or postponed
Many marketing activities have begun to be cancelled or postponed. If the situation becomes more serious, it may be withdrawn further. European Advertising Week, SXSW and Mobile World Congress have been canceled, Adobe Summit (US) has also been canceled. Last week, Facebook announced that it would no longer hold the F8 developer conference.

For Adobe Summit, the event was conducted as an online event. One effect of the virus may be a shift to online seminars and other online events because companies and institutions avoid large-scale gatherings. With the creation of digital marketing channels and online potential customers, content alliances may also be more valued, while advertisers and suppliers still need to convey information and maintain sales channels.

In response to the uncertainty surrounding the event, the business messaging app, Guild set up a CREO group or the new coronavirus epidemic response group for event organizers, which is a peer support for anyone who will host an event in the next 6 months group.

Panic buying leads to higher prices
One of the consequences of any disaster is panic buying. There is a lack of hand sanitizer, hand sanitizer or toilet paper on the shelves of the supermarket, as consumers start saving and making bulk purchases.

Liberty Marketing research shows that due to the outbreak of the new coronavirus epidemic, retailers selling their own brand of hand sanitizers online on eBay have accelerated the development of e-commerce

Due to emergency purchases, especially supermarkets may become increasingly crowded. In addition, because shoppers will avoid retail stores, they may switch to online shopping to avoid the risk of infection. JD.com's sales of household necessities such as rice and flour surged, quadrupling compared to the same period in 2019.

Urgent purchases are putting more pressure on the food distribution network. However, it is difficult to predict what items consumers will reserve if the virus continues to spread.

Potentially, the retailer's opportunity is to obtain sales from new customers who do not usually shop online. For brands, it is crucial to put customer attention first and pay close attention to how consumer behavior responds to the crisis.

The way people work changes dramatically
This is the most significant health-related crisis in the real digital age, and one of its consequences may be the increase in remote work. At the technology center in Seattle, many workers at Amazon and Microsoft have already started working from home. In China, the number of calls and meetings in Microsoft Teams meetings at Microsoft Teams increased by 500%, and the number of Teams used on mobile devices increased by 200%. Zoom Video Communications shares soared, and announced better-than-expected fourth-quarter results.

In summary

Although the change in consumer behavior is a short-term trend, this change may have long-term and lasting effects. Compared to other periods, e-commerce now accounts for a larger share of overall retail sales, so in this crisis, the long-term impact on digital transformation may be greater than other health scares.

For brands, the key to reducing the impact of the new coronavirus epidemic is to put customers at the core of marketing and pay close attention to changing customer behavior, especially in response to changing e-commerce trends.