Ecommerce reached new heights during the pandemic. But with restrictions easing in many countries, more people are resuming in-person activities, whether that’s dining out or going to the gym.
This begs the question: will this growth last? And what will the future of in-store vs. online shopping look like?
In this blog, we answer these burning questions, and dig deeper into what omnichannel looks like in a post-COVID world.
Put simply, consumers’ fondness of online shopping isn’t disappearing as restrictions lift.
On a global level, shopping online is the preferred way to shop for the majority of consumers. As might be expected, this is driven by Gen Z and millennials with around 60% preferring to shop online. Usage of ecommerce sites like Amazon and retailer sites like Walmart have also shot up during the past year.
38% of consumers say that compared to 12 months ago, their online shopping has increased, a further 1 in 5 also expect their online shopping to increase even more in the future. Interest in shopping online remains high even among older generations.
All great news for retailers who have invested in their digital offerings during the pandemic, and for those who haven’t, even more of a reason to start.
Grocery is a great example of a category that exploded online during the pandemic. Virtual queues were a common sight as more and more consumers flocked to get their essentials. In the U.S., just over 30% of consumers purchased groceries online in the past month, up from 20% in Q2 2019.
Supermarket giant Kroger has tapped into consumer needs and recently teamed up with Instacart to launch a “virtual convenience store”, which offers deliveries of groceries in as little as 30 minutes.
Increased shopping for groceries has helped to create more familiarity and comfort with online shopping generally, which will naturally spill over into even more categories in the future.
The role of in-store: let’s get personal
Shop closures were a common sight during the pandemic. In the UK alone, several big department stores like House of Fraser and Debenhams shut their doors, while John Lewis cut its stores from 50 to 34, in a bid to pivot to a digital-first strategy.
But the physical store isn’t a thing of the past. Just look at Amazon who are reportedly creating new retail spaces, aimed at boosting its retail offering.
It’s all about striking the right balance between online and offline.
The role of the physical store will be massively centered around providing a human-centric, personal experience – albeit one that addresses lingering concerns about hygiene. Ecommerce has its limits – a big one being the experience often feels very mechanical.
We see evidence of where physical retail can shine in our GWI USA data.
Having good customer service is a high priority for in-store shoppers, and has increased in importance since Q2 2020. This is more important than having access to money-saving features like coupons or loyalty points, both of which have decreased in importance since last year.
For example, those wanting coupons have dropped by 9%. Highlighting just how much consumers’ value a personal, human experience. Retailers need to focus on nailing the basics first and foremost.
Even with customer service getting more important, there are signs that consumers are still concerned about hygiene in retail spaces – something that may persist with the Delta variant.
Self-service has become more important to shoppers, while good fitting rooms and free samples are falling down the priority list. While it’s widely accepted that ventilation is the most effective way to mitigate the threat of COVID transmission in public spaces, there appears to be lingering concerns to do with surfaces touched by other people.
As consumers have been cooped up for so long, when they do venture out, many are likely seeking a more exciting experience, one that beats scrolling through websites. Good customer service will help provide this. But they still want those assurances of safety and hygiene as well.
A blended approach is the future
The most resilient retailers will be the ones who have a clear online and offline channel strategy. One that’s cohesive and consistent.
Dick’s Sporting Goods and Ulta Beauty both pivoted quickly during the pandemic to digital channels to meet consumers where they were at.
Now, foot traffic is picking up and being ready for both is key.
Dick’s and Ulta Beauty are experimenting to find ways to enhance both the in-store and digital experience. At Dick’s, this involved creating its House of Sport concept, where customers can try out gear in a variety of settings.
Meanwhile, Sephora’s Store Companion provides customers with access to information on products in-store that they looked at online, among other features like a Color Match, which recommends makeup products and colors based on a selfie.
For U.S. consumers, the most important factors when buying online are free shipping, free/easy returns policy and a secure payment process, all of which have become more important since Q2 2020. These factors are important for retailers to get right – as consumers continue to buy more online, they don’t want to pay to receive or return something they end up not liking.
With consumers being far less likely to stay loyal to brands – dropping 16% over the past year and a further 26% for Gen Zers – retailers can’t get complacent.
They’ve got to work even harder to get consumers on board.
To drive engagement, retailers will need to offer a seamless brand experience while consumers switch between online and offline shopping. This will mean nailing the basics and ensuring a consistent, personalized strategy is in place both online and in-store.