News • 28.04.2020

Coronavirus: digital commerce spend to fall by 14 percent in 2020

Spend set to recover in 2021 as offline spend moves online

Laptop on which an online shop page is displayed
Source: Bildagentur PantherMedia / Andriy Popov

A new study from Juniper Research found that global spending on digital commerce will fall by 14 percent in 2020 as lockdowns and reductions in consumer spend are felt. Spending will fall from $11.2 trillion in 2019 to $9.7 trillion.

The new research, Digital Commerce Coronavirus Analysis: Impact Assessments & Market Forecasts 2020-2024, identified the digital ticketing area as particularly at risk; given the effect of widespread lockdowns on transport usage and events. It found that digital ticketing spend will drop by 59 percent in 2020 compared to 2019. Airline ticketing will struggle to recover fully over the next 5 years, as airlines face unprecedented cashflow challenges which are set to reshape the face of the industry.

Recovery anticipated in 2021 as digital channels benefit from offline to online migration

The research identified that digital commerce spend will recover in 2021; exceeding 2019’s spend levels by 4 percent. While Juniper Research anticipates the economic disruption from the pandemic will last well into 2021, digital services are better placed than offline commerce for recovery, as there has been considerable migration from offline spend to online during the pandemic. As a result of enforced changes during the pandemic, such as using contactless payments instead of cash, or buying groceries online, there will be permanent changes in consumer behaviour to the much greater use of digital services, which will bolster growth in digital commerce spend over the next 5 years.

The research also forecasts that payments for digital goods, such as digital games or video subscription services will continue to increase during the pandemic, as users on lockdown use digital services more extensively. Research author Nick Maynard explained: “Digital commerce vendors will face disruption in 2020, but the shift of spend from offline to online channels presents a crucial opportunity for the market. Vendors must act to build on increased digitisation of services during the pandemic to sustain future growth”. 

Source: Juniper Research

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