E-Commerce

Once a decade, the economy takes a small step backward in order to take a giant leap forward. Innovative companies will propel the economy forward.

New Era Opportunity: E-Commerce


In March 2020, the world shifted to digital. This included all forms of shopping.

People started getting their groceries, furniture, home supplies, dinner and much more delivered right to their doors. And now that everyone realizes how convenient it is, it’s not going away anytime soon.

The coronavirus accelerated the shift toward e-commerce. And with a complete solution to the virus possibly years away, Americans are going to become more reliant — not less — on e-commerce in the near future.

US E-Commerce Penetration: Pre-COVID-19 vs. Post-Covid-19 Estimates Chart. Source: Global X ETFs, US Census Bureau

Practically everybody buys online today. About 96% of Americans have made an online purchase in their lives, and 80% have made one within the past month. At the end of 2019, Amazon — the e-commerce king itself — reported 112 million Prime members. That’s up 93% from 58 million subscribers in the first quarter of 2016.

It’s no secret that e-commerce is rapidly grabbing market share from traditional brick-and-mortar retail. In 2017, online sales soared 24.8% from the prior year, accounting for 10.2% of global retail sales. It accounted for about 11% of total U.S. retail sales in 2019.

And that’s set to keep climbing. By 2023, analysts expect e-commerce to grow its market share by another 45% to $735 billion.

Because technology is making shopping convenient for everyone, anywhere, global e-commerce is expected to grow by at least 10% a year over the next five years into a $7.7 trillion industry.

But the future of e-commerce doesn’t simply hinge on where consumers can buy the things they need — delivery is important too. The leaders of the trillion-dollar e-commerce market need to efficiently and cheaply deliver these products.

So, the e-commerce tipping-point trend is also fueling a renaissance in delivery. I’m talking about autonomous delivery vehicles, unmanned drones, you name it.

In fact, Walmart and Amazon are already deploying delivery drones in the U.S. These companies’ drone programs are an important step for showing that air delivery is safe and reliable.

After all, people enjoy the speed and convenience of Amazon’s two-day shipping for its Prime subscribers. And services such as Prime Air, Amazon’s drone delivery division, have the potential to be way better than that.

Plus, unlike food and grocery delivery services such as Uber Eats and Instacart, drones are fully automated. That means they could be much cheaper than paying human drivers.

As technology improves and drones get larger, faster and smarter, there’s no reason why they can’t become a normal part of our everyday lives.

And with thousands of drones zipping around the skies, the e-commerce industry will become even bigger and more profitable than it is now.

But e-commerce isn’t just limited to clothes shopping and impulse purchases from Amazon. Physical goods and services that were once transacted person to person are moving online — even perishable goods such as food and medications. E-commerce is shaking up grocery shopping as we know it.

This century’s biggest change to grocery shopping has finally arrived. With this transformation, you’ll never again have to don your hat and gloves to venture out to the grocery store on a cold winter’s day. (Or, more likely, don your medical gloves and mask to risk entering a coronavirus-laden store.)

In this very present “future,” you can order groceries from the comfort of your living room or from the seventh hole on the golf course. Or, even better, your connected appliances can decide when it’s time to order more eggs and milk without you ever lifting a finger.

The coronavirus outbreak is truly accelerating e-commerce technology at a simply unbelievable pace — and e-commerce still has room to grow. The category is poised to grab even more market share from traditional brick-and-mortar retailers over the next few years.

E-commerce is just another trend that is ushering in the new era of tech — the economic boom that the U.S. will see after we conquer our current coronavirus crisis.




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