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Barriers Preventing Many Organizations From Sustained E-Commerce Growth

Barriers Preventing Many Organizations From Sustained E-Commerce Growth

Arifa Sheikh, Joris Zwegers and Prem Shunmugavelu

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The coronavirus has made e-commerce a bigger priority, but most organizations are still struggling to turn it into a substantial revenue driver

The AMA and Kantar surveyed marketers in mid-2020 to understand how they and their organizations view the role of e-commerce. While the pandemic has accelerated the importance of e-commerce for some companies, its strategic role is still unclear in others, with structural enablers acting as barriers to sustained growth.

Many headlines over the past several months have touted the “new normal” and the accelerated growth of e-commerce as a priority revenue source. However, the actual story is a bit more nuanced:

  • The number of organizations indicating that e-commerce is a top priority for their leadership only increased slightly from the same time in 2019 (see exhibit 1).
  • If we look closer at the organizations that do indicate it as a top priority, we see that the coronavirus pandemic has accelerated e-commerce’s importance (see exhibit 2).
  • In line with this, we only see a modest increase in organizations actively engaging in e-commerce in general (from 51% to 57%) and for most, the contribution to revenue remains modest or small at best (see exhibit 3).
  • The pandemic has proved to be a catalyst for most of the surveyed organizations active with e-commerce, with 73% of respondents citing slight to significant increases in the channel’s contribution to revenue growth specifically because of the virus (see exhibit 4).
E-Commerce is a top priority for the organization's leadership
has the importance of

The pandemic undoubtedly accelerated a shift to a larger share of e-commerce sales, but many organizations have yet to start this journey. Additionally, while the impact of the coronavirus on e-commerce revenue has been significant for some, overall it has been modest for most organizations. The data suggests that there are significant barriers holding back success and pushing e-commerce to be a real revenue driver. Aside from the obvious issue that some organizations might struggle to free up the necessary budget to drive e-commerce growth, the results from this study identified several internal factors that will hinder success:

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Arifa Sheikh is senior director of brand strategy at the Consulting Division of Kantar.

Joris Zwegers is partner, global research at the Consulting Division of Kantar.

Prem Shunmugavelu is vice president of e-commerce, omnichannel & digital, at Kantar.