It's been over two years since the start of the pandemic. One thing’s become clear: the digital shift is here to stay. In 2021, global ecommerce continued to grow by 14.2%. And despite the return of brick-and-mortar stores, 70% of customers say they’ve changed their buying habits for good.

The world is reopening, but the impact of the pandemic lingers. How is ecommerce changing with the times? And what challenges do different industries and countries face in 2022 vs. 2020?

In our Online Merchant Survey Report 2022, we asked 1700+ ecommerce merchants to reflect on their fraud and payments challenges in 2021. We compared these results to data collected in 2020, so you can see exactly how ecommerce has shifted YoY.

Let’s take a closer look at the continuing impact of Covid-19 on ecommerce and your business.

Was Covid-19’s impact on business positive?

The short answer? Yes! We asked merchants whether the pandemic impact had been positive or negative for business overall. In 2020, only 46% of businesses said the impact was positive. In 2021, this rose to a whopping 65%.

This could be because order volumes and profits continue to soar for many online merchants. Our survey shows that in 2021, order volumes increased for 50% of merchants, and profits rose for 37%. Only a quarter of merchants saw a decrease in orders. So the future's looking bright for ecommerce.

In a recent Fraudology podcast, CIO at Ravelin, Mairtin O’Riada, comments:

“It’s so interesting that the Covid-19 impact on business was largely positive. But it's easy to rationalize why. It engendered this forced adoption of ecommerce from people who were never going to be ready for it. We didn't know it was the end of commerce as we knew it!”

How are different ecommerce industries evolving?

Every industry (and business) faces unique challenges. Some ecommerce industries view the pandemic's impact in a better light than others. Here's a closer look at different sectors and how they've evolved from 2020 to now...

Digital Goods and Subscription industries are riding high

Digital Goods and Subscription industries exploded early on in the pandemic, as online entertainment became a lifeline and subscriptions provided novelty distraction.

These industries continued to flourish in 2021. In 2020, only 45% of Digital Goods merchants said the pandemic had a positive impact on business. But in 2021, this went up to 74%. And these industries were most likely to report increases in order volumes and profits.

But your business isn't immune from Covid-related challenges. Take Netflix for example. The world’s largest streaming service lost 200,000 subscribers in Q1 of 2022 largely due to unregulated password sharing and increasing prices.

In 2022, customers are tightening their belts amid widespread inflation, so you'll have to fight to stay on top.

The tide is turning for Travel & Hospitality merchants

The Covid-19 outbreak was devastating for Travel & Hospitality merchants. Restrictions on international and domestic travel brought the industry to its knees. More than two dozen airlines closed, and many iconic hotel chains shuttered. So it makes sense that in 2020 very few said the pandemic impact was positive.

But the tide turned last year, as early signs of a travel comeback emerged. In 2021, a huge 65% of the industry said the pandemic had a positive impact. Plus those who said the impact was very positive doubled, and those who said it was negative almost halved.

The 2022 travel boom is now well underway. Bookings are flooding in as customers want to make up for lost time. This is great! But the speed of the comeback may have caught some merchants off-guard, as many are overwhelmed and understaffed.

Travel & Hospitality merchants, you’ve made a strong comeback, but you'll have to invest in tech and people to secure future success.

It’s been a rollercoaster for Online Marketplaces

Food delivery and product marketplaces were customer favorites in the early pandemic. But online marketplaces now have the most negative outlook on the pandemic’s impact. And they’re most likely to say profits have decreased.

The marketplace business model is notoriously cost-intensive and low-margin, so it's easy to see why it’s hard to turn a profit. But the change in outlook could be because marketplaces wrongly anticipated a decline in business in 2021.

Leading food apps expected demand to fall as cities reopened and the necessity factor wore off. And taxi marketplaces expected driver shortages to worsen with increasing demand. So optimism fell across marketplace sectors.

But marketplaces, you should start to feel more optimistic. Food delivery demand remains strong, and taxi apps are finding clever ways to overcome shortages, like Uber teaming up with New York taxi firms to increase supply.

Which global ecommerce markets have transformed the most since 2020?

So you’ve seen how ecommerce is evolving across different industries, but what about across the world? Here's a snapshot of two countries in a digital whirlwind and how they view the pandemic's impact...

France is now a global ecommerce leader

Ecommerce in France has really taken off. Around 75% of merchants in France have now said
the effect of the pandemic has been positive, up from 46% in 2020. The market is going from strength to strength. By 2026, the market value will almost double to $203 billion. This growth rate is one of the fastest in Europe, placing France as the seventh largest ecommerce player in the world.

LatAm ecommerce might be growing too fast

LatAm-based merchants have the least positive outlook on the impact of the pandemic despite extreme ecommerce growth. Positivity in Brazil hasn’t increased at all YoY, and in Mexico, 33% say the impact’s been negative. But your region is at the top of the 10 fastest-growing ecommerce countries in 2022 list. So why the pessimism?

It’s possible ecommerce in this region is growing too fast. LatAm fraud levels are hitting new heights. Almost 80% of Mexico-based merchants noticed an increase in online fraud in 2021. And 20% of new online accounts created in the region are fraudulent. Merchants may be concerned that demand is outpacing tech capabilities, putting your customers and business in danger.

How is the face of fraud changing?

You might be surprised to hear that fraud levels in 2021 were even higher than in 2020, as over 60% of merchants saw new fraud risks emerge.

In 2021, fraudsters continued to game the pandemic to their advantage and develop new schemes. Refund and promo abuse/fraud, marketplace seller fraud, social engineering via telephone orders and even fake QR codes became rising threats.

Covid-19 created the perfect storm for these fraud types. Merchants had to make their returns policies more generous, encourage doorstep deliveries, offer QR codes to avoid hygiene concerns - the list goes on. For every new Covid policy, fraudsters found a hack.

These fraud types are also rising because they side-step SCA. After PSD2 came into full force last year, traditional CNP fraud in Europe became harder for fraudsters. This is a win for merchants, but the fraud community will always find alternative routes.

Martin Sweeney, CEO at Ravelin, explains this pattern:

“When you whack a mole over here, another one pops up over there. Refund abuse, promo abuse, marketplace fraud, all of these are manifestations of the fraud community’s need to extract value from the merchant. If your business is attractive, they'll find other ways to get you.”

The shifting fraud & payments landscape will keep you on your toes in 2022

So it's fair to say that from 2020 to now, the pandemic has caused a lot of change for your business and customers. Globally, the fraud and payments landscape is still volatile. You need to stay agile and provide reliable buyer experiences to thrive in 2022.

For more information on trends and strategy, read the full Online Merchant Survey 2022.