Cautious Consumers; Etsy Up 130%; Amazon Growth

Consumers Likely to Wait to Return to Normal Activities
In our most recent consumer study, we found that while a majority of respondents expect the COVID-19 crisis to subside by the end of July, they are likely to wait longer to resume a number of typical activities that involve traveling, shopping and going out in public. Absent good news on the crisis front, the results suggest we are several months away from consumers doing basic things like dining-in at a restaurant or going to a movie. Travel plans also appear to have been scuttled for 2020 as it appears that behavior will be the last to catch up. Based on these results, planning should incorporate a very gradual return to normal that will take at least the rest of the year and potentially into 2021 as well.  

Etsy Reports Strong 1Q GMS Growth and 2Q Guidance as April GMS up 130% Y/Y
Etsy reported its 1Q results last week, and saw strong growth in 1Q with US GMV trending up 36% Y/Y as both active buyers and GMS per customer increased as compared to last year. More notable was Etsy’s outlook for 2Q, as management indicated that they saw 130% GMS growth in April, driven in large part by $133M in face mask sales, although non-mask sales were also up 79% Y/Y. As a result, Etsy expects GMS for the full quarter to trend up 80-100% as compared to the same period last year.  

Amazon GMV Sees Fastest Growth Since 1Q18
Amazon saw growth continue to accelerate in 1Q as demand increased dramatically in light of the COVID-19 crisis. Estimated GMV grew 24.8% in the quarter, up from 20.8% in 4Q19 and 12% in 1Q19. This represents the fastest growth that Amazon has seen in GMV since 1Q18. Amazon noted that much of this increased demand came in essential categories, including household staples, health and personal care, groceries, and home office supplies, while some non-essential categories such as apparel, shoes, and wireless products saw lower demand in the quarter. Amazon is making significant investments in order to facilitate the increased demand that it is seeing, including hiring 175,000 new employees (80,000 hired in March and 95,000 hired in April), spending $1B on faster fulfillment, and spending $600M in 1Q and $4B in 2Q on COVID-19 related expenses. 

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