Trends in the E-commerce and in the Traditional Retail Sectors During the Covid-19 Pandemic: an Evolutionary Game Approach

TL;DR

This paper uses an evolutionary game model to analyze how consumer and producer behaviors evolved in e-commerce and traditional retail sectors during COVID-19, highlighting logistics investments and delivery trends.

Contribution

It introduces an evolutionary game framework to compare retail sectors and examines how logistics investments influenced consumer preferences during the pandemic.

Findings

E-commerce saw increased investment in logistics and warehouses.

Fast delivery became a dominant consumer preference.

Traditional retail did not exhibit the same logistics-driven evolution.

Abstract

An evolutionary game model is developed to study the interplay between consumers and producers when trade takes place on an e-commerce marketplace. The type of delivery service available and consumers' taste are particularly important regarding both game payoffs and players' strategies. The game payoff matrix is then adapted to analyse the different trading patterns that were developed during the COVID-19 pandemic in both the traditional retail and e-commerce sectors. In contrast to the former, investment in logistics and warehouses in the e-commerce sector allowed for the emergence of a trend in which fast delivery and eager consumers are becoming the norm.