Online vs. In-store Business Growth

The public health crisis forced our lives indoors, and our shopping habits online. There are many who would believe that the e-commerce market was unequivocally endorsed by the pandemic. Shouldn’t in-person retail be practically obsolete by now?

But despite suffering some casualties, the retail storefront lives on.  

Against a century, technological obsolescence is rapid. We can conceptualize these broad swaths of time, reduce and enlarge parameters of time in our minds, but as yet, few live for that long. When scaled to the length of our day-to-day, technological overhaul is frequently gradual. It’s also dictated in part by where you live. 

The bubble of a wealthy Western country tends to serve as an incubator. The least developed countries in the world face problems of terrain, censorship, unrest or funding to advance technologically. For instance, in Eastern Africa’s Eritrea, only 0.91% of the population have internet access. So despite the revolutionary nature of the internet, it hasn’t yet infiltrated all human life in the same way. 

The organic nature of technological change is in part, what saved storefront retail. Business owners had begun to diversify with an online presence before the pandemic. This helped entrepreneurs and individuals alike. It also had an impact on the trajectory of online and in-store business growth. When we look back at the pandemic, it will be seen as a turning point. But to where?

Let’s take a look at how these two settings for commerce have changed in the last year.  

Online Commerce

The most cataclysmic economic events are often impossible to predict. Keen witnesses could and did foresee the US housing crisis of 2007. Hurricane Katrina, not so much. A global pandemic was the last thing on our minds, until suddenly it was everything. And it would become a defining moment in the economic history of this century. In e-commerce, it had a massive impact, with transactions jumping by 45.6% from Q3 in 2019 to Q3 in 2021. 

We all did it. How could we not? Our lives shifted online during the pandemic. From carrots to couches, an online purchase was just the ticket for a time of isolation or mandatory cohabitation. It didn’t just make us feel safe, it actually made us safe. 

And now that we know how to reduce risk and manage infection better, now that we have vaccines? Now that infection rates are coming down in most places, except Europe? It’s safe to say we are heading back to stores, with just a slight downtrend in digital penetration. But most impressively, we’re still witnessing growth. In Q3 of 2021, e-commerce went up by 6.8%. And according to Adobe, it’ll hit $1 trillion in sales for the year. 

Clearly, it’s not just the pandemic keeping us in this space. We’ve discovered our new favorite form of convenience. And when it comes to customer experience, that’s consumers’ top priority. No questions-asked returns policies and mad-fast delivery are almost a given. The best sales can now be parsed without upping our step count or dodging strange elbows. Reviews from friends and strangers sort the wheat from the chaff. Plus, it’s still a shopping ‘journey’, right? Websites and apps are often immersive. From AR tech letting you try things on through the website before you buy, to AI-driven size predictors, it not only minimizes risk, it’s plain fun.

It also can’t be denied that receiving the packages is just like Christmas, even for those who don’t celebrate but have always wanted that same sweet feeling. 

But how is brick-and-mortar business taking this spike in online shopping? 


Chuck E. Cheese’s parent company saw revenue plummet by 90%. Screaming children weren’t exactly allowed to get together during this time. People weren’t really trying to get anywhere, so Hertz filed for bankruptcy

According to Forbes, 12,200 US retail businesses closed in 2020. In 2019, it was 9,300. Of course, there’s no taking lightly the livelihoods of any of the businesses forced to close, due to COVID or otherwise. But when you think about the largesse of the pandemic, the surprising thing is that more brick-and-mortar businesses didn’t close down and demonstrated resilience.

After being cooped up for over a year, there are some of us antsy to get out and mingle with other shoppers once more. Even the tinny Christmas music of November won’t deter us from merry browsing. We’ve even learned to distinguish smiles from stares, without being able to see each other’s mouths. 

Our enthusiasm is fuelling a bounce-back; in Q3 of 2021, offline sales grew 11.5%. “Many analysts expected a good chunk of last year’s growth to stick with many consumers becoming more accustomed to buying digitally”, says Ben Unglesbee from Retail Dive. However, the strong return to in-person sales means that the diversification between the digital and physical is valued by consumers. 

Retailers are also looking at ways to enhance the in-person experience with tech. Online orders for pick-up and payment; mobile inventory phones for floor workers; better ERP systems; it all fuels faster, more concise customer experience. Employees benefit from this, too; they don’t have to deal with the consequences of inefficiency that is out of their control. The verdict? Forrester projects that 72% of retail purchases will still take place off-line in 2024. 

It’s fairly safe to say that in-store retail is here to stay. Business owners and consumers will continue to invest their time and money in tech that makes their retail journey faster, more convenient and immersive. But the brick-and-mortar isn’t going anywhere anytime soon. I, for one, am glad. 

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