eCommerce Increased Importance During Stagflation

From Our CEO: Fred Dimyan | August 4, 2022

During the last recession, most retailers saw their sales and profits plummet due to the economic recession but Amazon.com flourished. According to Digital Commerce 360, total sales for the 2009 recession increased 28%.  As we experience economic pressure today, online marketplaces will increase in their importance over Brick and Mortar stores. Here are 3 reasons why:

  1. eCommerce marketplaces like Amazon and Walmart.com have a massive product selection advantage vs Brick and Mortar stores. Amazon’s catalog has several hundred millions items, many at discounted prices compared to Brick and Mortar. Expect marketplaces to continue to grow their huge product selection and price competitiveness.
  2. eCommerce marketplaces will be an outlet for the unloading of excess inventory,  Major retailers like Walmart and Target are having difficulty unloading inventory after experiencing unexpected sales slowdown in categories including home, apparel, and electronics, leading to higher markdowns and liquidation
  3. With inflation at a forty year high, many manufacturers are pushing price increases. Pushing prices higher is already difficult online, so it is even more important to monitor and police online activity to ensure agreements are being upheld and if they aren’t, to be able to act quickly.

An online brand protection strategy is crucial to your brand’s success, and even more so in these economic times.

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