Advertise Here
Icon

Directory

IconAssociations and Institutes
IconBBBEE Consulting and Verification Agencies
IconBenefit Administrators & Investment Managers
IconConsumer Protection
IconCorporate Governance
IconCredit Bureaus
IconEmployee Benefits Consultants
IconFinancial Planners
IconIndependent Principal Officer
IconIndependent Trustees
IconOmbud
IconPension Fund Trustee Liability Insurance
IconPension Fund Trustee Training
IconPension Funds Adjudicator
IconPublications
IconRegulatory Authorities
IconRetirement Advice
IconRetirement Funds registered by the FSB
IconRetirement Products
IconSocial Grants (Government)
IconTrust Establishment & Management
IconWellness Programs
Image
  Subscribe To »

Is the Covid-19 e-commerce boom here to stay?

Published

2020

Tue

28

Jul

The Covid-19 pandemic has accelerated the adoption of e-commerce in a way no company could have imagined. In fact, in many instances, it has brought 3-5-year sales projections forward in just a matter of months. “Many businesses are already living in the future,” said Gerrit Smit, Partner - Head of Equity Management at Stonehage Fleming UK, in a recent webinar for clients.

 

A good example is Amazon, which has experienced record levels of demand, comparable to a usual Christmas period. Not only has its online retail operation thrived, but its video and web services have also flourished during the lockdown periods around the world. 

 

Then there are digital payment companies, such as PayPal, which has recorded a remarkable increase in transactions across their network. “They took on 7.4m new customers in April alone - a 135% increase. Those new customers are doing more transactions than ever and the business is experiencing retention rates to match,” Smit said.

 

Visa, too, is benefitting. Quite apart from an increase in online purchases, hygiene-conscious consumers’ reluctance to touch cash has further boosted business. “This is a game-changer for all payment companies whose biggest competitor is cash.”

 

E-commerce is perhaps the most striking example of structural shifts in the economy. Since the beginning of Covid-19 alone, e-commerce penetration as a percentage of retail sales in the US economy has increased in a matter of three months as much as it previously took a decade to achieve. “This must be one of the biggest economic shifts in the world for a long time, if not ever,” Smit said. “Nor is this trend likely to reverse materially once economies have fully opened and the virus has receded.”

 

With millions of people working and learning from home, consumers have been forced to rely on e-commerce, and have come to understand the benefits of obtaining goods and services through the internet. These include variety, safety, convenience and certain cost savings, amongst others.

 

From an investor’s perspective, the economic shift to online is revitalising important investment opportunities. In addition to large retailers like Amazon and payment systems like PayPal and Visa, technology companies that enable working from home have also benefitted. Consider 5G network providers, data and voice providers, cloud services, data handling and office automation services. 

 

More time at home has also meant more home cooking, to the benefit of many food and spices companies, as well as an increase in home design and décor products and services as people adapt their homes for new requirements. 

 

Entertainment and streaming services have also benefitted from people spending more time at home, as have online exercise offerings.  And of course, this has translated into an increased interested in leisure and sports clothing lines.  

 

Investors will find no shortage of newly-energised investment opportunities, Smit said. “High uncertainty and market volatility, however, will remain a challenge. Good stock selection is as critical as it has ever been. Investors should be very selective with their investments – buying only quality businesses with strong balance sheets.

 

Gerrit Smit is Head of Equity Management UK at Stonehage Fleming. He manages the Stonehage Fleming Global Best Ideas Equity Fund.

 

 
Source: cdcom
 
« Back to previous page Print this page » |
 

Breaking News »

Wealthy families support the fight against COVID-19

New research from international family office Stonehage Fleming has revealed that the COVID-19 pandemic is leading to a significant shift in the key priorities of many wealthy families. This finding and others ...
Read More »

  

Review your will to account for COVID-19, advises JustMoney

The COVID-19 pandemic is a timely reminder of the importance of ensuring your personal finances are in order – and a key component of this is an up-to-date will. This legal document, that should take into ...
Read More »

  

HOW UNCLAIMED MONIES CAN CONTRIBUTE TO ECONOMIC AND SOCIAL DEVELOPMENT OBJECTIVES

By: Elio E’Silva, Head of Direct Corporate Solutions, Alexander Forbes Prescribed assets for retirement funds have been discussed extensively as a potential source of funding for state-owned entity (SOE) ...
Read More »

  

SIMPLIFYING THE RETIREMENT FUND DEATH CLAIMS PROCESS

By Dolana Conco, Regional Executive at Alexander Forbes   Losing a loved one is one of the most difficult experiences a person can go through, and during this difficult time, you don’t want your ...
Read More »

 

More News »

Image

Healthcare »

Image

Investment »

Image

Life »

Image

Short-term »

Advertise Here
Advertise Here

From The Glossary »

Icon

Legal Liability:

The liability imposed by law for negligence that results in injuries or death or damage to someone else’s property.
More Definitions »

 

Advertise

 

eZine

 

Contact IG

 

Media Pack

 

RSS Feeds

By using this website you agree to the Terms of Use.
Copyright © Insurance Gateway (Pty) Ltd 2004 - 2020. All Rights Reserved.