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CoverStory

Global ecommerce sales are the preceding 30 days. In August 2020, as many pandemic-
related closures were lifted, that rose to 60 percent, which
on pace to reach $4.2 trillion was still far below the pre-pandemic share of 96 percent.
this year, with year-over-year Meanwhile, the share of consumers making online or
growth of 39 percent in the over-the-phone payments for purchases previously made
in person rose from 22 percent in April 2020 to 41 percent
first quarter, according to the four months later.
Adobe Digital Economy Index Atlanta Fed consumer surveys also revealed a rise in mer-
chants steering consumers away from cash payments.
Among consumers who reported making in-person pay-
ments, 45 percent said merchants requested non-cash pay-
Everything touchless ments at least some of the time; 24 percent reported such
There's nothing new about touchless commerce—digital requests were made always or most of the time.
wallets, tap-and-go payments, QR codes, buy online for Many faces of online buying
pickup in store (BOPIS) or at curbside. But the use cases
were lacking, stated Don Apgar, director of merchant ser- Global ecommerce sales are on pace to reach $4.2 trillion
vices at Mercator Advisory Group. "What problem were this year, with year-over-year growth of 39 percent in the
they trying to solve?" he asked. first quarter, according to the Adobe Digital Economy In-
dex, published in April. In the United States, ecommerce
The answer became clear with COVID, as merchants and accelerated 49 percent in March, compared to March 2020,
consumers confronted the possibility that more tradition- with consumers spending $78 billion online during the
al ways of shopping and paying could contribute to the month. Adobe also found that 9 percent of U.S. online
spread of the virus. Then there were the realities of gov- shoppers are new to the channel. Blackhawk Network
ernment-imposed business shutdowns. "Now you have a reported that 56 percent of Americans have been making
use case driver," Apgar said. online purchases for home delivery since the pandemic's
onset.
"The pandemic pushed everything toward contactless;
consumers are now driving merchants to make the neces- But not all online purchasing is for delivery. Among the
sary upgrades," Crone added. In fact, an April 2020 Mas- new shopping habits spurred by the pandemic and social
tercard survey of consumers in 19 countries found 79 per- distancing requirements are BOPIS and curbside pickup,
cent were using contactless payments, citing safety and collectively known as click-and-collect.
cleanliness concerns; 74 percent said they would continue
to use contactless payments post pandemic. eMarketer reported that U.S. click-and-collect sales jumped
106.9 percent in 2020, and are on track to grow another 15.2
Card-issuing banks are taking notice. The chips used for percent this year, to reach $83.47 billion, or 9.9 percent of
EMV compliance can also incorporate contactless anten- all retail ecommerce sales. Total buyers jumped from 127.4
nas for contactless payments. But U.S. banks had lagged million in 2019 to 143.8 million in 2020.
behind those in other countries in issuing cards with a The biggest drivers of the trend are large retailers.
contactless interface. By the end of 2020, however, 300 mil- Walmart, Home Depot, Best Buy, Target and Lowes com-
lion contactless credit and debit cards had been issued in bined accounted for more than half of all click-and-collect
the United States, up from 100 million at year-end 2019, sales last year, eMarketer said.
according to Visa.
Click-and-collect for grocery purchases is extremely pop-
The State of Retail Payments study conducted in 2020 by ular and is expected to account for 58 percent of all pur-
the National Retail Federation and Forrester Research re- chases made via click-and-collect in 2021 and 60.4 percent
vealed that 67 percent of retailers were accepting some in 2022. These trends will continue, as many consumers
form of no-touch payment. That included 59 percent that continue to prefer hunkering down at home.
were accepting contactless cards, up from 40 percent in
2019, and 56 percent accepting digital wallet payments, "Consumers' use of their homes as the hub for entertain-
up from 44 percent in 2019. At the time of the survey, 19 ment and social occasions is not temporary," the consul-
percent of retailers said no-touch payments accounted for tancy Accenture stated in a recent report. As evidence of
more than half of in-store transactions. this trend, a consumer survey conducted by Accenture
found 67 percent planned to do most of their socializing
A report from the Federal Reserve Bank of Atlanta fur- from home over the next six months.
ther illustrates changing payment patterns. In April 2020,
just 34 percent of consumers surveyed by the Atlanta Fed A consumer survey by the consultancy EY found 43 per-
reported making at least one in-person payment during cent expect to cook at home more often.

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