Shift in ecommerce behaviour
By NatalieB, 6th August 2020
Here at YAN, we like to think we are a glass-half-full kind of bunch. We are always on the lookout for silver linings and when it comes to consumers, we have found some encouraging signs.
An estimated 17.2 million consumers in the UK, (nearly a quarter of the entire population) will permanently change the way they shop, redirecting their spending online. A substantial amount of the UK who have adopted online shopping for the first time during Covid-19 do not intend to change these new habits. This new group, combined with those already used to digital shopping, will generate an extra £4.5 billion in UK online retail sales in 2020. * Research by Alvarez & Marsal (A&M) in partnership with Retail Economics
Lockdown pushed us (we are all consumers here) online and this creates a huge opportunity for smaller players, especially in niche sectors not traditionally online, like our pubs, gardening, and fitness suppliers.
When research giant Mintel looked at consumer behaviour this June, they found that 39% of folk reported that they had been encouraged to purchase products online that they had not considered before, such as pet food, alcohol and shoes. Mintel expects the market to grow by a third this year.
Consumers favoured local shops during the lock-down
Fifty-nine percent of UK consumers have shopped in more local stores since lockdown, in order to help support them, according to research from Deloitte. Yes, restrictions on travel may have played a part in this but it appears that consumers are becoming more mindful of the impact of their spending in their local communities. This makes us happy. Long live #planetpositive.
In the same research, a staggering 57% said that they were more likely to buy from a brand that sells products locally sourced after lockdown, than they would have at the start of the year.
Continuing with the conscious theme, 1 in 5 have actively stopped buying from a brand because of its response to or during the pandemic, such as not providing a safe working environment for its employees. This figure rises to 28% in shoppers aged between 16-24, reiterating the importance of brand purpose for younger consumers.
Flight to digital here to stay
4 in 10 UK shoppers say that Covid-19 will fundamentally change the way they shop, says a new EY.
It is encouraging. Many consumers say they plan to continue shopping online even as brick-and-mortar stores reopen. In markets that had moderate online conversion rates before the pandemic, (such as the United Kingdom and the United States), e-commerce continues to grow across all product categories.
- Grocery sector up 50%
- Apparel including footwear and jewellery up 15-29%
- Household supplies up 50%
- Fitness and wellness up 30-49%
In addition to e-commerce, other digital and contactless services—including outside pickup, delivery, and drive-through service—are also seeing much higher adoption rates. While some of these habits are a work-around to the crisis, many at-home solutions to regular activities will likely be adopted for the long-term.
Covid-19 has given the ecommerce sector a boost. It is easy to lose your hopes and brood over the negative side effects of any event, especially when as a community we are battling a global pandemic. For every low, there is a high and it is true that even this current scenario has a silver lining to it.
What is the #1 positive impact the lockdown has had on you? We would love to hear your thoughts.
YAN Bank believes in a future of fair, equal, and sustainable business. We, like our customers, believe in transparency and open banking. Our mission is to support businesses and customers alike with products and services that are convenient, affordable, and less bureaucratic.