With many businesses around the globe pausing operations, retailers are quickly shifting their focus to adjusting to the new economic climate, identifying new global trends, and understanding the habits and behaviors of their consumers.
While not every business is in the same position, the palpable changes in consumer behavior affect everyone, regardless of industry. No longer operating “business as usual,” retailers must find a way to adjust their digital strategies to connect and engage consumers trapped at home and keep their businesses going through the second half of 2020.
In our recent webinar, “Ecommerce Briefing: Changing Consumer Behavior and Global Macro Trends,” GBG had the opportunity to partner with Emarsys, the only omnichannel customer engagement platform, to uncover the macro trends that are forming globally. Alex Timlin, SVP Retail at Emarsys and Matthew Furneaux, Global Commercial Director at Loqate – a GBG Solution, discussed the impact that the coronavirus is having on consumer purchasing behaviors in the retail industry, and how these trends can help shape your business’ e-commerce strategy. Here were some of the highlights:
Coronavirus is strongly influencing consumer demand
- The trends in consumer behavior are closely linked to the economic status and political initiatives of the country in question, for instance, North Carolina opening in the US this week and the UK announcing three more weeks of lockdown. Or, in Germany, stores with a smaller footprint being allowed to start trading again.
- Corona driven panic buys are just a “phase”; but are still causing strong surges in online products such as increases in sportswear and equipment or surges in toilet paper purchases.
- Huge leaps or declines in online transactions are corresponding with these critical dates, so companies need to be agile during quarantine to keep up with consumer phases.
- 22% of attendees said they are feeling very optimistic about their business outlook for the second half of 2020, while only 7% consider themselves very pessimistic.
No two retailers are experiencing the same impact
- Brands who traditionally only sold in-store are now switching to digital and online channels, leading to e-commerce orders increasing.
- The beauty industry is trending. Cosmetics sales online are up 50% in places like Europe and are even higher in Northeast Asia.
- Consumer demand has increased for loungewear, sportswear, and in-door health and fitness products due to global shutdowns of gyms and fitness centers and calls to stay-at-home. Sports and hobby product sales are up 32% in Europe and 192% in the US.
- Midmarket fashion is markedly under pressure for both online and offline orders. Online sales cannot replicate the amount of money they are losing from their physical trade, even if there is slight growth, such as the rocket ship growth that occurred during the Easter period.
- While Italy’s in-store and online trade have been heavily affected by Covid-19, their luxury sector is seeing a massive boom in online sales as consumer confidence increases.
- Governments in places like Germany and the US are experiencing a lot of pressure to reopen, as many businesses do not believe they have the finances necessary to be closed for three weeks to six months.
Consumer driven activity 25 days post lockdown based on reports from hundreds of UK and US customers.
We’re seeing a bigger response to digital communications than ever before
- Businesses are spending less on ads and paid activity and focused more on organic activity like social engagement.
- Brands looking to succeed in the new normal are turning to digital tools and communications. Even companies that have had to cease trading altogether have introduced initiatives to maintain customer relationships and loyalty in hopes they can pick up where they left off rather than have to win back customers.
- While data shows that times are still tough for app recruitment and downloads, time in-app and push communications are on the rise.
- We also have seen an incline in digital engagement as data shows that web clicks and impressions have increased over 40% since 2019.
- Brands are maintaining the relationship with consumers through social, choosing to keep a relevant and personalized conversation going– even if there are no transactions.
- According to our polls, email (88%), website (77%) and social media (75%) are the top three channels attendees are using to stay in touch with their customers.
Activity on social and digital channels are traversing generations
- Social channels like Facebook, WhatsApp, Messenger, and Instagram are seeing exponential increases in engagement from more than just millennials.
- Older generations are also shifting to the digital realm, not just for engagement and purchases but also when it comes to viewing and consuming content.
- Every generation is checking social media more often, including 30% of millennials, 29% of Gen X, and 15% of Boomers.
- Trends like virtual learning and working from home are driving traffic to apps like Zoom, Skype and, Google Meet.
- Businesses can capitalize on this trend by making it easy for the “Zoom” generation to engage with their brand online.
- Retailers that have already invested in digital and social channels have an advantage over those who are recently transitioning from offline to online. For example, online only retailer, Gymshark, who has experienced 56% growth as of April 2020.
What e-commerce brands & retailers need to do now
- Cross border commerce is on the rise; pay attention to which countries are open for business and how that affects online sales.
- Now more than ever, brands need to listen to their customers rather than try to artificially create trends in the market. Analyzing data and recent trends will help to define what the current opportunities are for you and for your business.
- Look at your overall trading environment and not just domestic policymaking, but where your customers are and how they are behaving to help find and act upon new opportunities in the coming months.
- There is a great proportion of international brands that are selling to consumers around the world. It’s essential for businesses trading in different markets to keep a pulse on these trends; from the companies in Sweden who haven’t had a large amount of negative press domestically to Australia and New Zealand, where the government controls what types of products customers can buy and brands can sell to manage capacity on imported items.
- Retailers will begin adopting mobile technology at a faster pace than before, which will enable them to accommodate consumer behaviors and expectations. Since your customers have been climatized to a new normal, engage with them in new, innovative ways.
- In the face of changing consumers, it’s critical for retailers to invest in e-commerce and mobile technologies now.
Check out the entire discussion by watching the full webinar on-demand here. Interested in how other organizations are handling the crisis? Read our blog to see the ways 80 businesses around the world are combating COVID-19 today.