Mastercard Recovery Insights: E-commerce a Covid Lifeline for Retailers with Additional $900 Billion Spent Online Globally
April 06 2021 - 12:01AM
Business Wire
New Report Spotlights Retail’s Digital
Acceleration
As Covid-19 kept consumers around the world at home, nearly
everything from groceries to gardening supplies was purchased
online. According to Mastercard’s latest Recovery Insights report,
this amounted to an additional $900 billion being spent in retail
online around the world in 2020. Put another way: in 2020,
e-commerce made up roughly $1 out of every $5 spent on retail, up
from about $1 out of every $7 spent in 2019.1
For retailers, restaurants and other businesses large and small,
being able to sell online provided a much-needed lifeline as
in-person consumer spending was disrupted.
Roughly 20-30% of the Covid-related shift to digital globally is
expected to be permanent, according to Mastercard’s Recovery
Insights: Commerce E-volution. The report draws on anonymized and
aggregated sales activity in the Mastercard network and proprietary
analysis by the Mastercard Economics Institute. The analysis dives
into what this means by country and by sector, for goods and
services, and within countries and across borders.
“While consumers were stuck at home, their dollars traveled far
and wide thanks to e-commerce,” says Bricklin Dwyer, Mastercard
chief economist and head of the Mastercard Economics Institute.
“This has significant implications, with the countries and
companies that have prioritized digital continuing to reap the
benefits. Our analysis shows that even the smallest businesses see
gains when they shift to digital.”
While the digital transformation has been neither universal nor
consistent – due to geographical, economic and household
differences – the report uncovers several key overarching
trends:
- Early digital adopters go into overdrive: Economies that
were more digital before the crisis—such as the UK and US —saw
larger gains in the domestic shift to digital that look more
permanent than the countries that had a smaller share of e-commerce
before the crisis, such as Argentina and Mexico. Asia Pacific,
North America, and Europe were the strongest regions in driving
e-commerce adoption.
- Grocery and discount store digital gains look sticky:
Essential retail sectors, which had the smallest digital share
before the crisis, saw some of the biggest gains as consumers
adapted. With new consumer habits forming and given the low
pre-Covid user base, we anticipate 70-80% of the grocery e-commerce
surge to stick around for good.
- International e-commerce rose 25-30% during the
pandemic: International e-commerce got a boost both in sales
volume and the number of different countries where shoppers placed
orders. With infinitely more choices at their fingertips, consumer
spending on international e-commerce grew around 25-30% year over
year from March 2020 through February 2021.
- Consumers increase their e-commerce footprints, buying from
up to 30% more online retailers: Reflecting expanded consumer
choice, our analysis shows that consumers worldwide are making
purchases at a greater number of websites and online marketplaces
than before. Residents in countries like Italy and Saudi Arabia are
buying from 33% more online stores, on average, followed closely by
Russia and the UK.
- Shift to electronic payments accelerated in the US: Even
in store, Covid-19 accelerated the transition to digital—with more
consumers moving from plunking down cash to touch-free payments.
According to our analysis of payment forms at brick-and-mortar
retail stores and restaurants, we saw non-cash payments jump by an
additional 2.5 percentage points beyond the ongoing trend. This led
to an acceleration of the shift from cash to electronic payments by
a full year.
Recovery Insights: Commerce E-volution can be viewed here.
Mastercard launched Recovery Insights last year to help
businesses and governments better manage the health, safety and
economic risks presented by Covid-19. The initiative draws on
Mastercard's analytics and experimentation platforms, its
longstanding consulting practice and unique data-driven insights to
deliver relevant and timely tools, innovation and research.
Methodology
The report draws on anonymized and aggregated sales activity in
the Mastercard network and proprietary analysis by the Mastercard
Economics Institute.
1The Mastercard Economics Institute drew on activity within the
Mastercard network and modeled global retail e-commerce across all
payment types to determine the additional retail e-commerce
spending based on the deviation from the trend.
About the Mastercard Economics Institute
Mastercard Economics Institute launched in 2020 to analyze
macroeconomic trends through the lens of the consumer. A team of
economists, analysts and data scientists draws on Mastercard
insights - including Mastercard SpendingPulse™ - and third-party
data to deliver regular reporting on economic issues for key
customers, partners and policymakers.
About Mastercard (NYSE:MA)
Mastercard is a global technology company in the payments
industry. Our mission is to connect and power an inclusive, digital
economy that benefits everyone, everywhere by making transactions
safe, simple, smart and accessible. Using secure data and networks,
partnerships and passion, our innovations and solutions help
individuals, financial institutions, governments and businesses
realize their greatest potential. Our decency quotient, or DQ,
drives our culture and everything we do inside and outside of our
company. With connections across more than 210 countries and
territories, we are building a sustainable world that unlocks
priceless possibilities for all.
Disclaimer
© 2021 This presentation and content are intended solely as a
research tool for informational purposes and not as investment
advice or recommendations for any particular action or investment
and should not be relied upon, in whole or in part, as the basis
for decision-making or investment purposes. This content is not
guaranteed as to accuracy and is provided on an "as is" basis to
users, who review and use this information at their own risk. This
content, including estimated economic forecasts, simulations or
scenarios from the Mastercard Economics Institute, do not in any
way reflect expectations for (or actual) Mastercard operational or
financial performance.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210405005491/en/
U.S.: Will Tsang William.Tsang@Mastercard.com (914) 414-5420
Global: Julia Monti Julia.Monti@Mastercard.com (914)
217-9533
MasterCard (NYSE:MA)
Historical Stock Chart
From Aug 2024 to Sep 2024
MasterCard (NYSE:MA)
Historical Stock Chart
From Sep 2023 to Sep 2024