Home Science & Tech Our in-person purchases hurt big tech

Our in-person purchases hurt big tech

by YAR

This decline in online shopping is not limited to one company. Other e-commerce stars, such as Etsy and Shopify, whose software powers online business for millions of smaller stores, also posted unexpectedly low sales growth or low expectations for the near future. An analysis by Mastercard showed that US online purchases fell in March for the first time in nearly a decade, while in-store purchases rose.

Not surprisingly, e-commerce purchases soared as people huddled at home in 2020, retreating once many became more comfortable shopping in person and again eager to splurge on travel, dining out, and other in-person activities. But companies didn’t really see this pendulum coming.

Facebook parent company Meta said last month that its sudden ad sales were in part because online shopping companies became less eager to buy ads on Facebook when their sales were under pressure. “The acceleration of e-commerce led to outsized revenue growth, but now we’re seeing that trend reversing,” Mark Zuckerberg told Meta investors two weeks ago.

And Meta said last week that he was slowing down his hiring.

All this cost cutting and lack of confidence in the future would have seemed crazy six months or a year ago, when Meta, Amazon, Google and other tech companies had insanely crazy revenues and profits.

The question this raises is whether we misjudged the past two years of technology-driven changes in consumer behavior. Yes, some of us who take the habits of buying more from home and Zooming everything will continue to do so. But there has also been a return to the behaviors of 2019. Last week, I shook hands with everyone at a business meeting and wondered what happened to the prediction that the virus would end handshakes.

We still don’t know what “normal” is in the US or elsewhere, and probably won’t for a year or more as our spending habits adjust to higher prices, continuing hardships with manufacturing and shipping, rising interest rates, continued coronavirus infections, and a desire to have fun in the real world.

The new normal for shopping will likely resemble neither the return of brick-and-mortar stores we’ve seen in the last six months nor the rise of online shopping from 2020 onwards. The collective behavior of millions of Americans is hard to predict. And that is shaking all technology.

Source link

Related Articles

Leave a Comment

The Float