Ladies and gentlemen, start your shopping: A flurry of shopping events is coming this November and sales records for online spending may be broken yet again. However, as COVID-19 hovers in the background, this year’s events could be facing new challenges. What is expected and how can investors find potential in e-commerce stocks during this time?
Your capital is at risk.
November is Shopvember
Alongside Amazon’s Prime Day, which took place in October, the three most important shopping days of the year happen in November. Shoppers around the world have their credit cards at the ready and spend billions upon billions of dollars on discounted items. At the same time, investors eagerly follow the sales numbers, to try and determine which e-commerce stocks present the hottest opportunities. Using today’s intuitive and easy-to-use platforms, buying a share of an e-commerce platform, on which you shop and in which you believe, is as simple as ordering a new smartphone.
Singles’ Day 11.11
Created by Chinese eCommerce giant Alibaba, Singles’ Day is a massive online sales event, offering thousands of products at special 24-hour discounts. Originally intended for a Chinese audience, the sales event quickly turned into a global phenomenon, attracting shoppers from around the world. The event breaks its own sales record year after year, and in 2019, reached total sales of a whopping $38 billion.
This figure is substantially larger than its American counterparts. This is because companies in China have placed great emphasis on attracting both local and global audiences to this shopping day. Some of the largest players in the Chinese e-commerce space can be found in the TBanque ChinaTech Smart Portfolio.
Black Friday
Since the 1950s, the first Friday after the American Thanksgiving holiday is considered the beginning of the Christmas shopping season in the US. Often the busiest day in shops across the country, it was dubbed “Black Friday,” due to the chaotic atmosphere which characterises it. Nearly every retail store in the country offers sales and discounts, and numerous Americans use this day to shop. Last year, the online portion of sales was significant, reaching $7.4 billion.
Cyber Monday
A more recent addition, the Monday after Black Friday is an online-only event. Like its Friday counterpart, Cyber Monday offers numerous deals and sales online in the US and the rest of the world. Last year, the online sales event was a major success, overshadowing its offline predecessor and reaching a total of $9.4 billion in sales.
The COVID-19 Situation
As highly anticipated as these sales events may be, especially with their potential to impact e-commerce stocks, 2020 has a significant x-factor: The COVID-19 pandemic. The global phenomenon, which has impacted the lives of nearly everyone on earth, will also affect these otherwise highly celebrated online shopping events. Some of the factors to consider are:
- Financial liquidity: Billions around the world have seen their income affected by the Coronavirus pandemic, and they may be less inclined to spend as much this year. On the other hand, this could also mean that some individuals are more calculated and have waited with their shopping sprees until one of the above-mentioned sales events.
- Logistics: While China has mostly recovered from the coronavirus pandemic, many countries around the world are still under lockdown measures, a fact which could impact shipping times, product availability and many of the peripheral processes that are required for a smooth online shopping experience.
- Online shopping fatigue: During the pandemic, people who were forced to remain indoors switched much of their shopping online. This means that they may be less enthusiastic about online shopping events and will be less prone to spending their money specifically during these sales events.
It is important to note that the coronavirus pandemic has also contributed to the shift to online commerce, and many individuals around the world significantly increased the amount of shopping they do online — possibly forever. At the end of the day, this may be the most influential factor that could see November 2020’s shopping days as the most profitable ones to date.
Investing in E-Commerce
As mentioned above, Black Friday marks the beginning of the holiday shopping season. Despite the COVID-19 pandemic, or maybe due to it, online shopping should continue to grow until the end of the year and in years to come. Alongside Amazon and Alibaba, other e-commerce giants, such as eBay, Jumia, ASOS, Etsy and others are also set to benefit from the growing online shopping trend.
To give its investors exposure to the online shopping industry, and other e-commerce-related segments, TBanque has created the ShoppingCart Smart Portfolio. Comprising well-known international retail giants, alongside pure e-commerce players, ShoppingCart has performed tremendously well in 2020.
Some of the most prominent e-commerce stocks in the portfolio include:
- Amazon: The world’s largest online retail company, which reached a valuation of more than $1.6 trillion in 2020.
- Alibaba: The Chinese e-commerce giant which has revolutionised online shopping around the world.
- Netflix: The leading online streaming company, which offers its users subscriptions to a massive selection of TV shows and movies.
- Spotify: The world’s leader in streaming audio, including music and a vast network of podcasts.
- And many others…
TBanque users who are looking for an e-commerce investment and want to gain exposure to a diversified basket of e-commerce stocks, could consider investing in ShoppingCart.
This is a marketing communication and should not be taken as investment advice, personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been prepared without taking any particular recipient’s investment objectives or financial situation into account, and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past or future performance of a financial instrument, index or a packaged investment product are not, and should not be taken as, a reliable indicator of future results. TBanque makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared utilising publicly available information.
