April 6 (UPI) -- As the COVID-19 pandemic kept people at home, consumers around the world spent $900 billion more at online retailers in 2020 compared with the prior two-year trend, according to Mastercard's Recovery Insights report released Tuesday.
In 2020, e-commerce made up roughly $1 out of every $5 spent on retail, up from about $1 out of every $7 spent in 2019, the report said.
For retailers, restaurants and other businesses selling online became a way to survive the economic shutdowns resulting from the pandemic.
About 20% to 30% of the shift to e-commerce globally is expected to be permanent, the report said.
The report draws on sales activity in the Mastercard network and proprietary analysis by the Mastercard Economics Institute. The analysis dives into what this means by country and by sector, for goods and services, and within countries and across borders.
Nearly every retailer's online sales increased because of the pandemic, as curbside pickup or takeout deliveries became the norm.
Mastercard chief economist Bricklin Dwyer said in an interview on CNBC's Worldwide Exchange with Frank Holland that about 20% to 30% of the $900 billion in additional digital spending will continue this year and the next few years.
The e-commerce gains in the future will depend on what a retailer sells and how they adapted their business model.
Grocery and discount stores will see the most dramatic and lasting shift to e-commerce, according to the report. Discount stores are defined as dollar stores, wholesale clubs and other retailers that sell to customers at near wholesale prices.
The report said grocers will likely retain about 70% to 80% of the digital sales gains generated during the peak of the pandemic, the report said. Discount stores will retain about 40% to 50%.
Online sales made up only a single-digit share of overall sales for grocers and discount stores before the pandemic.
Clothing stores, restaurants and sporting/toy stores saw the biggest initial spike during the pandemic, but only kept 10% to 20% of that peak in sales, the report said.
Electronics and department stores are expected to keep about 20% to 30% of their peak increases during the pandemic. Those retail sectors had the highest penetration of online sales before the pandemic. E-commerce made up about 55% to 60% of electronics sales and 40% to 50% of department store sales, according to Mastercard.