The Covid-19 pandemic profoundly changed consumer behavior, triggering an unprecedented surge in online shopping. However, this trend also has a downside: many small businesses are forced to close their doors due to a lack of flexibility in adopting the digital consumption model. A recent report by the Valencian Institute of Economic Research (Ivie) and the BBVA Foundation highlights the dramatic impact of this development on retail in Spain.
Digital Transformation: A Challenge for Brick-and-Mortar Retail
Six years ago, 47% of the population shopped online; today, that figure is almost 57%. These new customer habits have absorbed the increase in demand observed during the health emergency, which had temporarily benefited proximity businesses. However, this was not enough to halt the loss of nearly 50,000 businesses in the last five years (2019-2024), representing one-third of all establishments closed since 2000. In the first quarter of 2020 alone, 20,808 retail businesses closed, according to the National Institute of Statistics (INE).
The study emphasizes that the health crisis affected retail in two ways: directly, through restrictions and capacity limits, and indirectly, by permanently changing consumption and purchasing habits. Self-employed individuals proved particularly resilient in this trend of concentration, experiencing a smaller decline in their employment (under 13%) in the first quarter of 2020.
Online Sales: A Driver of Growth and Concentration
The strong commitment to online sales has been one of the main factors accelerating the decline of retail (which mainly consists of small businesses) given their lower degree of digitalization. In fact, large companies withstood the pandemic’s impact by leveraging the boom in online demand, while smaller businesses, despite initially benefiting from the resurgence of proximity shopping, ultimately experienced the largest sales declines.
“Although e-commerce was already experiencing sustainable growth before the health crisis, the lockdown marked its definitive launch, with behavior that has been maintained to this day,” the study states. Indeed, online sales in Spain have almost doubled between 2019 and 2024, growing by 95% to 95.2 billion Euros.
Sector-Specific Impacts and New Buyer Profiles
Some sectors were more affected than others. While food sales saw a 10% year-on-year growth in March 2020, clothing and footwear sales plummeted by up to 90% in April 2020 compared to the previous year, only beginning to grow again in March 2021. The report indicates that commercial activity related to personal equipment (clothing and footwear) has experienced the strongest growth from 2021 to 2024 (46.7%).
In 2020, online sales focused on essential categories such as food, drugstore, and hygiene products. Their online share increased from 1.5% to 3.5%, with 1.6 million new buyers. There was also a notable increase in virtual purchases by senior profiles, with 30% of these new users being over 50 years old. Similarly, the rise of the mobile phone as a channel for this type of consumption stands out, with a boom of over 62%.
The Future of Retail: Omnichannel as the Key to Success
Online sales are now consolidated. Although growth slowed in the first months of 2021, and even some declining data was recorded, they continue to grow above the sector average. The BBVA Foundation emphasizes that the survival of retail will largely depend on its ability to adopt an omnichannel model. This model effectively integrates online and offline channels to enhance the customer experience. The physical establishment thus becomes more than just a point of sale, gaining relevance by providing a valuable consumer experience with personal attention and added value to the visit.
