The Stay-at-Home orders associated with COVID-19 have significantly impacted consumer behavior given the new realities around brick and mortar and the meaningful pivot to E-Commerce. In our estimation, the inevitable transition to e-commerce was pulled forward by at least 5 years.
To better understand the economic impact on direct-to-consumer companies, we aggregated Shopify data from over 50 consumer brands and dove into growth rate changes during the COVID era.
Based on our analysis, brands are experiencing significant revenue growth in their E-Commerce channels. In the first 10 weeks of the year, on average, sales grew by 53% year over year.
In the time since Stay-at-Home measures were implemented, brands have seen a 92% growth in sales when compared to the same period last year.
It shouldn’t be surprising that industries with the highest growth rate are those with products directly related to Stay-at-Home activities. Comparing the first 10 weeks of the year to the 6 weeks since Stay-at-Home, we’ve seen revenue growth rate increases of:
- 15x for companies in arts & craft
- 9x in athleisure
- 4x in personal care
- 3x in the kitchenware and food
We spoke to Iva Pawling, CEO of Richer Poorer, an athleisure and lifestyle company, who let us in on some of the trends she’s noticed.
“We have seen a huge spike in the sweats category with everyone being stuck at home. In the three weeks following the stay-at-home orders, our revenue from sweats was up 3x that of all of 2019.”
“We’ve always been really disciplined with our CAC, and made sure we were profitable on the first order,” Pawling added. “When Covid hit, a lot of retailers and brands braced for a difficult few months and either dialed ad spend way down or turned it off entirely. Because of that, we were able to see our CAC drop, and thus started spending more aggressively.”
Coronavirus will likely have a lasting impact on consumer purchasing behavior — what brands they trust, where they purchase, and how much they spend. It’s important that direct-to-consumer companies continue to be aware of these trends and be agile in terms of affecting change.
As we continue to gather data, we will dive deeper into the potential for the transformation of consumer goods and retail and, relatedly, the growth in the E-Commerce sector.
Assembled Brands is designed specifically to help small businesses navigate e-commerce growth by providing rapid financing, data-driven business insights, and an unrivaled network.
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