Investigating the Impact of Financial Crisis on Online Retail

Abstract

Many experts believe the global financial crisis in 2008 is the worst of its kind since the Great Depression in 1929. The crisis was started from housing market in the US and spread into financial markets. It had a ripple effect around the world and many other industrialized economies were troubled by its consequences and almost every industry has influenced by its outcomes. Online retail (or B2C e-Commerce) as a part of retail industry was not immune from the financial crisis. This paper investigates how the financial crisis has affected online retail industry. This paper uses the US statistics but it can be generalized to rest of developed countries. By discussing the statistics provided by department of commerce of the US, it is found that financial crisis has caused the online retail sales to decline. After that the reasons of decline in online retail sales are presented and a discussion about why the impact of financial crisis affects traditional retail harder than online retail is developed. Finally several solutions are recommended to prevent any further decline in the industry sales.