In 2020, the COVID-19 pandemic has caused vendor, seller and consumer behavior in the $3.5 trillion eCommerce industry to shift in ways nobody imagined earlier in the year.
Consumers are panic-buying online, stocking up on items like toilet paper and canned food. In an unprecedented move, Amazon restricted non-essential shipments to their warehouses outside of medical supplies, household items, and more. Production levels from factories in China are still slumping from February.
Sellers, in the thick of the chaos, face a crucial test right now. How do they stay ahead of the demand curve, and how do they stand out from the competition?
We were curious to find out. This past April, we sent out a multi-channel eCommerce survey to online merchants to answer:
- How is COVID-19 affecting selling and fulfillment strategies?
- How much money do people make and how many orders are they getting?
- Which categories are thriving and which ones are sinking?
- What are some top tools and software multi-channel sellers use?
- Which marketplaces were prioritized and deprioritized?
Over 1000 merchants, inside and outside of Deliverr, responded and provided some interesting insights.
Let’s dive into the results!
How did multi-channel strategies shift during COVID-19?
In response to COVID-19, over 65% of sellers took action and made changes to their multi-channel strategy playbook.
There’s never a better time than now to invest more into a non-primary marketplace than usual, and sellers seem to agree. This is often a popular move because of increased sales opportunity and diversification to spread out risk, as we discovered last year.
The second most popular strategy was adding new SKUs to an existing marketplace to expand product offering, and after that, signing up to sell on new marketplaces.
These are the top selling strategies ordered from most popular to least popular:
- Prioritized new marketplace(s)
- Added new SKU(s) / diversified inventory
- Added new marketplace(s)
- Removed / deprioritized marketplace(s)
Other answers respondents chose were to change the way they market to consumers or alter fulfillment strategies.
Which marketplaces did sellers prioritize?
We discovered that the top three marketplaces added and deprioritized were the same, in different order.
Of those who chose to add a new sales channel, 31% of sellers pursued Amazon. In second and third place, 20% of sellers chose eBay and 19% chose Walmart.
Given the legacy and popularity of Amazon, this may not be surprising that the fulfillment mammoth remains the top marketplace — while also falling down the agenda because of its March inbound restrictions.
Other answers included Etsy, Rakuten and Jet.
Which marketplaces did sellers deprioritize?
Ebay was the top deprioritized marketplace at 21%, followed by Amazon at 17% and Walmart at 14%.
Note: Sellers were allowed to select multiple marketplaces.
Does how much a seller make determine the way they sell during COVID-19?
Keeping in mind that every situation is individual to a seller, we noticed something interesting in our data set of everyone who chose to tweak their selling strategies.
While larger-tiered sellers ($2 million to $10 million in annual revenue) expanded their existing inventory by adding new SKUs, smaller to mid-tiered sellers (under $250k to $1 million in revenue) tended to prioritize non-primary marketplaces they already sold on.
It makes sense that the most popular strategy is prioritizing a new marketplace when looking at the bulk of our respondents, who cashed in $1 million in revenue.
Luckily, that takes us to…
The million dollar question
We asked how much multi-channel sellers make on their channels combined per year, and this is what they revealed.
53% of our respondents make $250k or less annually, 14% make between $250 and $500k, 10% make $500k to $1 million, 7% make between $1 million and $2 million, 5% make between $2 million and $6 million, 2% make between $6 million and $10 million, and almost 3% make $10 million or more.
How many monthly orders did the average seller have?
We asked sellers how many orders they ship out on average, and most of them replied that they ship out 100-300 monthly orders.
We discovered that 30% are selling 0 to 50 orders, 18% ship out 50 to 100 orders and 13% are in both the 100 to 300 and 300 to 1000 monthly order range.
Category Winners and Losers
Which categories are surging, and which of them are losing sales in the wake of COVID-19?
It’s no surprise that 19% of sellers notice that consumers choose to get food, in order to avoid eating out or visiting brick and mortar stores. It also turns out that 17% of sellers say their buyers are ordering more home goods and items in the personal care category.
Maybe it’s time to get some paintbrushes and smoothie blenders into the mix!
The category winners are:
- Personal Care
- Arts & Crafts
On the other hand, the categories taking a downward turn are:
What tools do multi-channel sellers use?
The reason why inventory management or listing tools often provide the recipe for success because they create a consistent, unified customer experience across multiple sales channels.
Its bulk uploads, inventory syncing and unified product descriptions are a great time and money saver — and over 72% of all our respondents are on board.
What’s in the average multi-channel seller’s toolkit? We asked what software and listing or inventory management tools they liked to use to organize their business.
This year, Sellbrite took the trophy, folled by SellerActive and then GeekSeller.
Other responses included Skubana, Inkfrog and CedCommerce.
Note: Sellers were allowed to respond with multiple tools about their stack.
What fulfillment partners do sellers use?
Who’s working behind the scenes to prepare, pack and ship out the orders? It looks like 51% of sellers appoint Amazon FBA, while 45% opt for self-fulfillment and 32% chose to fuel their operations with Deliverr.
Powering operations with a third party logistics company can be the difference between sink or swim for a business. Especially during COVID-19, consumers often opt for fast shipping options more than before — and many sellers quickly realize that outsourcing fulfillment can save them a big chunk of time and money.
Let’s circle back to everything the data is telling us.
How is COVID-19 affect selling strategies?
Most sellers opted to add a new marketplace and added new SKUs to their strategy playbook. The top reasons we found last year for going multi-channel is increased sales opportunities and diversification.
How does this depend on the size of the seller?
Sellers with more revenue tended to expand their current inventory, while sellers with low to mid-sized revenue prioritized a marketplace that they did not primarily sell on.
How much do sellers make?
Most sellers make $250k or less annually, while the second most popular revenue tier rests in between $250 and $500k.
How many monthly orders did the average seller have?
On average, 100-300 orders per month.
Which categories increased in sales and which ones decreased since the start of COVID-19?
Food, Home, Personal care and Arts & Crafts categories all saw a boost, according to our respondents. On the other hand, depleting categories are: Clothing, Auto, Electronics and Jewelry.
What software and other tools do multi-channel sellers like to use?
The most popular tools are Sellbrite, Selleractive and Geekseller.
What fulfillment partners do sellers choose to fuel their business?
The top fulfillment partner is Amazon, followed by self-fulfillment and Deliverr.