| I hold a pessimistic viewpoint because it's a lot more insightful to look at losses than it is gains. With so much brick-and-mortar retail shut-down, retail has to happen somewhere, so it's going to happen online. Increases in product sales online could result in net declines for the product group when you factor in the loss of B&M sales. I think the logical result here is pretty well-represented in how some public companies in this space's stocks prices are playing out. Distribution companies are likely to prosper because their competition has decreased substantially: * Amazon is at an all-time high
* Overstock has recovered their dip
* Wayfair is recovering their dip
* Chewy is at an all-time high None of this means the manufacturers who these distributors are selling are doing well, though. On the flip side, the product categories that are down substantially online are likely facing devastating loses. They already aren't selling in retail so if ecomm is it and they're down there, it's really bad. Outside of distributors, I think the D2C ecomm space is a huge mixed bag but likely net negative for a few reasons: 1. A lot of DTC companies play in the product categories that are seeing lower online sales 2. Most DTC companies are positioned as being accessible, but still premium. There are cheaper alternatives people may be more inclined to go with, given the economic uncertainty. Given that, layoffs at Away, Everlane, Third Love, Stitch Fix, Casper, etc. make sense, even if online sales as a whole are up. Some of them may even need to start paying attention to unit economics now! I'd guess a lot are scaling back advertising and trying to focus on lower-cost acquisition channels to keep a tighter grip on cash flow. |