Four Ways Covid-19 Changed Online Consumer Behavior

Last updated: 07-12-2020

Read original article here

Four Ways Covid-19 Changed Online Consumer Behavior

As consumer confidence plummeted during 2020's months-long quarantine orders, so did overall retail sales. But with consumers relegated to the confines of their homes, an uptick in online purchases was a foregone conclusion, and this changed certain behaviors, at least temporarily.

According to Rakuten Intelligence, U.S. e-commerce spending rose more than 30 percent from early March to mid-April year-over-year. The U.S. Census Bureau reported overall retail sales during May were up 17.7 percent from April. While these numbers could signal recovery, the same sales report shows total retail sales are still down 6.1 percent year-over-year and the conditions that drove this growth may be temporary.

Only time will reveal long-term trends in retail sales, but in studying industry data and working with my e-commerce clients to respond and adapt to their customers' expectations, what I do know are some of the ways Covid-19 impacted online consumer behavior.

The 'comfort factor' has been a big through line in the Covid-19 outbreak, as consumers have had to embrace many unfamiliar concepts and practices. But they adapted--literally and figuratively. 

While the apparel industry, as a whole, has taken a thrashing, it has seen a dramatic increase in online sales. The type of clothing being purchased is a clear byproduct of life in quarantine--in April, sales shifted significantly in favor of comfortable clothing. According to the Adobe Digital Economy Index, while e-commerce sales dropped 13 percent and 33 percent for pants and jackets, respectively, e-commerce sales for pajamas increased more than 143 percent.

Looking through a developmental lens, Covid-19 has forced consumers to become more comfortable with shopping online, sometimes in categories they might never have expected. Even my 93-year-old mother is doing her grocery shopping online. For some, this sort of forced trial was a catalyst for adoption.

According to data from Dotcom Distribution's 2020 e-commerce consumer survey gathered in April, while almost half of respondents (45 percent) reported they don't expect their shopping habits to change long term, nearly a third (31 percent) expect to make more online purchases than they did before the pandemic.

According to Bloomreach's State of Commerce Experience study, 50 percent of customers are shopping on digital channels for products they've never bought online before. As consumers continue to make more of their purchases online, engaging with different brands has raised their standards. They expect a singular experience that stands out among all e-commerce encounters.

With endless options, it's no surprise that same study found that more than half (53 percent) of customers will not buy from the same business again after a negative experience. These are two of many factors that illustrate the importance for brands to know their customers inside-out and deliver accordingly.  

This collective foray into the digital landscape marks an opportunity for brands to convert product sales by delighting and engaging customers through positive online channel experiences. Examples include personalized marketing tactics, how-to videos, virtual try-on technology, bundling offers, free shipping, premier packaging, and gifts with purchase.

In the pre-pandemic e-commerce landscape, we've seen through Dotcom Distribution's annual consumer surveys that the expectation for free shipping had been rising exponentially. As the seriousness of Covid-19's impact on consumer goods became increasingly evident, consumers pretty quickly came to terms with the reality that extended delivery timelines and pickup windows were often unavoidable. But these circumstances also reinforced consumers' desire for enhanced communication, especially regarding order status and shipping timelines.

While these delays were sometimes inconvenient--hello, grocery store time slots--this new appetite for communication and transparency provided a unique opportunity for brands to demonstrate their value and commitment to their customers.

According to Dotcom's study, the top five categories consumers reported purchasing most online prior to the outbreak, in order, were apparel, electronics, home goods, accessories, and food and beverages. Once the pandemic hit, the panic buying commenced with major spikes in essentials like paper goods, hand sanitizer, and disinfecting wipes.

Around mid-April, when some fear had subsided and confidence began to recover, the shopping focus shifted to categories such as kitchenware, books, toys and games, crafts, exercise equipment, and gardening--items that accommodated life in quarantine.

And now? According to the NRF, every category of retail has seen month-over-month gains and consumers are heading back to stores, but it's hard to say what patterns will hold. As we enter the warmer months and many people continue to spend more time at home and with family, it's likely we will see boosted sales for yard games and toys, patio furniture, gardening supplies and other outdoor-based buying.

Consumers have largely shifted their attention and spending to digital channels, marking a major opportunity for brands and retailers to capture the interest of shoppers open to exploring new and different options. Now is the time to invest in tools that help you understand your customers so you're better positioned to drive trial and secure loyalty.


Read the rest of this article here