E-commerce – “easy” way to make business thrive or invincible obstacle?

10.05.2021 5 Min Read
E-commerce – “easy” way to make business thrive or invincible obstacle?

Crisis caused by new Coronavirus accelerated pace of digital transformation even more and forced businesses to include remote work and development of e-commerce into the “agenda”. The other side of the market – consumers remained without digital influence. E-commerce became a replacement or filler of physical shopping for them and presumably, these changes will make deep roots in their behavior and will continue in post-pandemic period as well. However, background of these processes is even more interesting – did every business mange to timely and properly respond to digital challenges, what do international statistics say and what is the vision – did the pandemic landscape of retail trade give businesses time and resources to adapt?

International trends – are businesses ready for digitalization? 

It’s been a long time since change in consumer behavior and their readiness to engage in e-commerce processes became one of the main focus of studies conducted by international organizations. For example, United Nations Conference on Trade and Development (UNICTAD) annually measures B2C e-commerce index, which combines levels of internet consumption by individuals, share of protected internet servers and data on owning accounts in financial institutions. Similarly, International Tele-communication Union (ITU) offers information and communication technologies (ITC) development index [1], which is also oriented on online shopping behaviors of consumers and channels utilized in this process. This list also includes statistical data gathered by Organization of Economic Cooperation and Development (OECD).

If we have a look at e-commerce report called “E-commerce during the COVID-19 pandemic” conducted by OECD in October of 2020, we will clearly see that online commerce is very quickly developing. According to the report, retail sales (orders) made through e-mail and internet in EU member countries increased by 30% in April of 2020 compared to the previous year. Trends are similar in USA, where e-commerce orders increase by 14%-16% (see chart N1). The said report also highlights dynamic development of e-commerce in Europe, Northern America and Asia-Oceania regions in the first half of 2020.

[1] The ICT Development Index (IDI)

Source: OECD, E-commerce during the COVID-19 pandemic, 2020, October. Calculations are based on EUROSTAT statistics. 

UNICTAD report “COVID-19 and E-commerce” published in summer of 2020 shows quite an interesting picture, incorporating experience of 257 companies from 23 less developed countries [1]. Some of the identified trends truly deserve our attention:

[1] These countries mostly cover Africa and Asia – Pacific Oceania regions.

Source: UNICTAD, COVID-19 and its impact on e-commerce of businesses, 2020

ACT’s role – experience from even broader geographic area 

The 2020 pandemic and economic crisis enabled ACT through cooperation with different countries and international organizations (EBRD, World Bank, UNDP, USAID) in various projects to contribute globally in increasing sustainability of business sector and identifying pandemic channels affecting them. The said projects enabled us to study e-commerce development issues in focus regions (Caucasus, Western Balkans, South-East Europe, Central Asia and South and East Mediterranean) and do a research on the impact of the pandemic on businesses. As expected, business operating in focus regions shows different types of readiness for digitalization (chart 3). However, regardless of such different results, it is important to mention the overall attitude inquired respondents had in common – small and medium-size businesses have a desire to involve in e-commerce but they hesitate because of lack or complete absence of information and digital tools.

Source: ACT Research, 345 SMEs inquired in Caucasus, 827 SMEs inquired in the Western Balkan region 

Our team had a chance to additionally study challenges of small and medium business operating in Central Asia, South-East Europe and SEMED countries during the pandemic within the scopes of the EBRD-sponsored project “Impact of COVID-19 on small and medium businesses”. As a part of the given study, we asked respondents representing small and medium-size businesses what percentage share of the company’s sales switched to online platforms after the pandemic started. Overall picture is also very interesting, as declared by the majority of small and medium businesses from the listed regions, sales did not switch to online shopping at all, while only a very small part of companies managed full digitalization. Businesses operating in South-East Europe (chart 4) appeared to be the most prepared for such transformations, this can be explained by the fact that logistic services were already well-developed and organized in this region and already established practice of e-commerce.

Source: ACT Research, 570 SMEs inquired in SEMED, 598 SMEs inquired in Central Asia and 184 SME inquired in South-East European region 

Unplanned changes with long-term results 

The new Coronavirus pandemic turned digital development into inevitable reality. When searching for answers, we clearly saw that this seemingly simple way is actually quite complex process and to pass this road, only “desire to digitalize” is not enough. Businesses had to cope with all the problems which already accompanied the process of switching to a new platform: absence of relevant experience, lack of resources or infrastructure. Even though supporting business became main migraine for every government, the majority (more than 50%) of businesses participating in different studies unanimously admit that unfortunately, their government, when working on development of priority sectors, left this part behind and online commerce still remains as unsolved issue.

It’s a fact – digitalization has not entered our lives just temporarily. These are more unplanned changes which will bring prolonged, long-term results.

Author: Lika Goderdzishvili

Portfolio lead, development consulting

Featured Insights

The Coronavirus pandemic accelerated our digital transformation. Digital solution becomes more and more demanded in everyday life, main expectation each of us has is opportunity to carry out behaviors remotely. COVID-19 changed established perception of the work, education, medical service, social interactions, entertainment and relaxation, during the pandemic every service or product associated with all those aforementioned needs have been re-assessed according to their ability to keep us at home.

Modern parents’ gadget 

The impact pandemic made on online services changes in the long run and will never get back the world as we knew before.

Sopho Bukia is a successful journalist whose life was changed before the pandemic when her twins were born, babies were not even one-year old when the pandemic started, Sopho had to spend lockdown days in a locked apartment with her babies.

“We were completely isolated and fully relied on Glovo and Wolt delivery couriers. They became our main connection to the outside world. When it’s babies’ bed time and you discover that you forgot to buy milk for them, delivery man with a moped becomes the superhero delivering the most precious thing to you” – says Sopho. 

Sopho managed to squeeze in the normal ritual for new parents – running into grocery stores and pharmacies with babies or in turns, without babies when they are asleep and coming back stocked up for a week, in just one gadget which she uses for several types of services: delivery service apps for products, child care items and toys, medical app for consultation with a pediatrician and purchasing medications from the pharmacy, taxi ride service for the nanny.

Frequently used services 

Research and Consulting company ACT was interested to find out how has behavior of Tbilisi residents changed similar to Sopho’s behavior in terms of online services. According to the study conducted last month, every third Tbilisi resident activated use of digital banking services (online transfers, utility payments, ordering a card, etc.), 22% of respondents order ready-made food more often than before the pandemic, while 20% of respondents now shop clothing and shoes online more often than before. In addition, young respondents in 18-34 age group use online food apps most frequently, overall, every second young resident orders food online.

At this point, Tbilisi residents are less passive in purchasing groceries online. 83% of elder generations do not use online supermarkets at all, the majority of inquired respondents buy groceries in a traditional way – supermarket or corner shop. A small portion (13%) of young respondents from 18-34 age group started using online pharmacies, but digital version of this service does not beat personal visits to the pharmacies.

It is interesting to find out what motivates consumers to go out to purchase groceries and medications, is this the possibility to select the product locally, check the assortment, or in case of medications – time factor or probability of getting recommendation from the pharmacy consultant. Providers of the said services can get answers to each of this question as a result of observing and studying consumers.

Those behind the apps we use 

Before the pandemic, delivery service was considered as comfort service and part of people avoided paying for that service. This pandemic created the environment in which delivery services turned into everyday necessity from the luxury. During the isolation, in addition to food, online grocery shopping and delivery of medications/hygiene items from the pharmacy became important for consumers.

Increased demand on online services enabled startups operating in this field to achieve fast development – diversify service categories, expand – add staff and partner services of products and constantly improve offered services. All of those companies now study digitally active consumers to foresee what will be important tomorrow for them who avoids or cannot go out due to objective reasons.

What apps will remain in the gadget 

Are online shopping behaviors caused by the pandemic sustainable?

According to the study, when the pandemic ends and Tbilisi residents will return to the ordinary life, they will still continue using digital banking products (94%) and ordering food online (86%). As for grocery shopping and medications, they plan on making personal visits to stores and pharmacies.

However, similar to Sopho, there are consumers who already see distinct advantages in having consistent behavior of shopping online: “I used to do grocery shopping after leaving the office before the pandemic started, I hardly remember that time, but it was what I did. And this was a terrible process – one store does not have any cottage cheese, another is out of bananas, third one is out of something else and so on. You have to visit so many places. Then you need to take all these bags to the car. The same applies to the pharmacy. I’m loving the app that searches every product in one pharmacy. Lockdown or not, I will always use Glovo, Wolt, Ekimo apps. I just can’t live without them”. 

Consumer walks less 

Sopho and part of consumers still have problems when using online services such as delayed delivery, problematic system when curriers have often call consumers to check the address, incomplete order or problems in the payment system, but in this changed reality, necessity to be cautious about health and have more comfort make consumers see even more benefits in those services and wait for improvement of digital “switch”.

Before that, we continue protecting ourselves in the biggest fortress – home. Similar to others, Sopho tries to balance a busy day between work and parenting: ”I’m at home and not at home at the same time. I say goodbye in the morning exactly like before leaving to work, then I close my door and work till the evening. As a background noise, I hear their voices. I got used to the fact that they are behind the wall”. 

Digital transformation goes on quickly and similar to centuries ago, humans are inclined to squeeze in everything we need to feel safer and more comfortable in this fortress.


In 2002, for the purpose to promote books and reading, UNESCO started a large-scale project – “World Book Capital” when one specific city is nominated each year to be designated as the world book capital. On April 23 of 2021, this honorable status was designated to our capital city and consequently, Tbilisi will turn into world book capital for a year.

We all agree that during the world pandemic, Coronavirus to some extent helped us to push forward topics that are top priorities for us. Each of us had different ways to balance aggravated stress level by means of relatively pleasant activities, however, the choice was limited by the pandemic. Fortunately, reading books is on the small list of activities which, together with gaining knowledge, is a great way to relax.

If we say that the pandemic changed life for many of us, logically the question arises – did it make in influence on our habit of reading books?! In reality, did this suddenly spared time pushed our society to read more or in contrary, elevated stress turned us into passive readers?!

“Consistently studying change in the behavior of readers is well-established practice all over the world. Georgian market also needs such constant monitoring, as collected information acts as a foundation for right development of the book market. This topic is particularly important during the pandemic, which made significant changes in publishing industry” –declares executive director of Georgian Publishers and Booksellers Association, Tinatin Beriashvili.

In compliance with a joint request of Georgian Publishers and Booksellers Association and House of Writers, ACT conducted a large-scale study on the Georgian book market, certain tendencies have been identified based on the study results.

  • Reading books once a year, once in 2-3 months or every day 

According to the study conducted in February of 2021, our society is divided into two exactly equal groups: half of respondents who managed read fictional or non-fictional literature in 2020 and the other half, who could not read even a single book throughout the year.

Study results also clarify that more than half (56%) of readers read books at least once a week, among them – 19% managed to read intensively – every single day; almost one fourth of respondents reported on reading quite passively – once in two-three months at maximum. Number of such passive readers is even bigger in regional cities compared to Tbilisi.

It was of course interesting to get an answer on one of the main questions and find out whether the frequency of reading changed during the pandemic. As it turns out, the pandemic did not make any impact on reading habits of half of our reader respondents, while one third of respondents “blamed” pandemic for reading more frequently. 15% of respondents noted that unfortunately, they can spare even less time to read books.

Readers manage to read averagely 13 books throughout a year (the list starts with Georgian and translated literature leaving books published in foreign language in the minority), however more than half of residents (55%) report on reading 1-6 books. The study tracked some differences between those living in the capital city and regions – number of books read by Tbilisi residents is two times higher than number of books regional residents read during a year.

  • Favorite in locked space – fiction 

It is interesting to find out what is major factor when selecting the book to read? How popular the book is or something else? 46% of inquired respondents are guided by recommendations of friends and family when selecting a book, 42% of respondents focus on the contents and annotation of the book while 31% of readers make choice on their favorite authors.

As the study demonstrated, a vast majority (86,5%) of respondents prefer to read fiction mainly, while 13.5% of respondents love reading non-fictional literature. The most actively read categories of fiction over the past 1 year include modern literature, classic literature and detective/horror/mystics. As for non-fiction, readers are mostly inclined to books covering historical, political and cultural thematic.

“The pandemic did not affect my choice of fiction I read” – days 9 out of ten inquired respondents. However, the pandemic drove the remaining 10% of readers towards science fiction/fantasy/utopic and detective/horror/mysticism.

  • Where do we read, where do we buy 

It is quite logical that bookshops are prevalent among all other places where books are sold. Before the pandemic, 75% of readers would visit them, followed by the attendance rate on book fairs (18%). As for libraries, our respondents were even less active in visiting libraries. Not to say anything about the pandemic period, 77% of respondents did not have experience of visiting libraries even before, which they mostly explain with lack of time and need.

We were interested to find out what respondents think about updating their personal library in near future. According to the results, 14% of respondents are less likely or completely exclude the possibility of buying books this year. However, it’s not that bad, because 6 out of ten readers (64%) are still ready to visit places where books are sold, half of them (31%) are sure of it.

Regardless of the turbulent zone we are all in now, fortunately, books are still in demand and readers still intend on buying them. As it turns out, this new pace of life did not make any significantly negative impact on reading habits. However, it is impossible not to notice that half of residents cannot read books at all. This makes it even clearer and obvious, that habit of reading books needs to be encouraged and promoted.

As noted by consultant of international projects at House of Writers – Natia Lursmanashvili – “House of Writers is a living organism and publishers as well as readers are its beneficiaries. Accordingly, change of their behavior over the recent years (including the influence of the pandemic) is directly connected to defining future strategy of the organization”. 

* Survey was conducted through random sampling among 1000 adult (16+) residents of Tbilisi, Batumi, Kutaisi, Telavi, Gori and Zugdidi in February of 2021. Utilized method – FTF interview. Statistical error of data does not exceed 4.4%.  

Author: Ketevan Mamadashvili