Since July 2020, Wal Mart and Sam’s Club have successively announced the closure of physical stores on Thanksgiving Day, while the Black Friday Shopping Carnival that followed was eclipsed in physical stores due to the COVID-19 epidemic, instead prompting more consumers to turn to the online shopping craze.
Under the epidemic, mainstream e-commerce platforms such as Amazon have reduced their advertising investment on Facebook, Google, or other online marketplaces, which has to some extent brought traffic to independent stores. According to Rakuten Intelligence data, from March 12th to 15th, 2020, the online order volume of all category grocery e-commerce increased by 210.1% compared to the same period last year. Undoubtedly, epidemic prevention materials became the best-selling products in the second quarter.
Global-e’s data further shows that global cross-border online sales increased by 21% year-on-year from January 1 to June 14, 2020. Despite some areas experiencing a slowdown during the peak of the pandemic, sales in many countries have quickly rebounded. In May 2020, global cross-border online sales increased by 42%, and this positive growth trend was also maintained in June.
In depth analysis of this growth reveals that independent stores have contributed a significant amount of strength. At the same time, some large market platforms frequently adjust their policies, with commissions, service fees, and pay per click (PPC) fees constantly rising, leading to an increase in the cost of attracting traffic from market platforms and a corresponding reduction in the profit margins of market platform sellers. Therefore, more and more sellers are choosing to open their own independent online stores.
Overall, e-commerce or cross-border e-commerce is on the rise. But for independent sellers, it is quite difficult to accumulate and obtain customer databases on e-commerce market platforms. In contrast, independent online stores allow sellers to develop their own customer communities, master all customer resources, and establish brand awareness among these customers. Sellers can promote their products to customers via email during holidays or when new products are released. For sellers who find it difficult to handle unsold inventory, they can list these products on an independent online store.
Generally speaking, establishing an independent online store has the following advantages:
The threshold for building a website is low, and the setup cost is also quite low.
No business license is required, only an email address is needed.
No platform issues: No need to worry about connection, copyright, trademark, and other issues.
There is no need to worry about the store being forcibly closed or fined, nor is there a need to stock up in advance.
The system is easy to operate, with low startup capital, and only requires some e-commerce related experience to quickly get started.
Supports common payment methods such as PayPal and allows for independent or overseas warehouse shipments.
It can be connected to other accounts to achieve collaborative operation.
However, some sellers point out that although independent stores are exempt from most rule restrictions, the high maintenance costs and difficulty in bringing traffic to the website make it difficult for individual sellers to cope. On the contrary, experts believe that if sellers can bear the costs of operating on third-party platforms, they can also bear the related expenses of independent stores.
Nowadays, independent stores have become a popular choice for many cross-border e-commerce sellers. Having an online store not only helps people seize new profit growth points, but also benefits brand building and frees them from the strict rules of other market platforms.