By Matthew Robertson, co-CEO, NetDespatch
Last year we saw 24-hour supermarket shopping slump, with many supermarkets stopping around-the-clock opening hours in stores. . Most of the supermarkets were quick to say that this move was not a cost cutting exercise but down to customer shopping habit shifts as many more are now getting their essentials delivered online rather than in-store.
This doesn't surprise me at all. We have seen this trend evolving throughout 2016 and in particular over the holidays we saw a massive increase in consumers opting to shop online instead of on the High Street. In the final week before Christmas online sales surged to 51.1 percent.
In fact the UK is one of the largest ecommerce countries globally. According to the Ofcom International Communications Market Report we experienced the highest ecommerce turnover in 2015, more than any other country, with an average online spend of £1,800 per person. This statistic was 50% higher than the US and £600 greater than the next highest valued market at £1,200. And I imagine this statistic will be higher again for 2016.
So how are consumer shopping habits changing and what can we expect in 2017?
AI, AR and VR will impact the home and the consumer
CES 2017, one of the largest global consumer electronics and consumer technology tradeshows, announced that augmented reality, virtual reality and artificial intelligence will be the primary disruptive consumer technologies for the next 20 years. Additionally, last year research company Mintel foresaw virtual and augmented reality technologies entering our homes and stated that this will have an impact on how we shop, the brands we choose, and so on. You only have to think about the potential of drone deliveries instead of receiving your goods via the good old parcel delivery driver to start to see the impact that technology can have on shopping habits.
Thanks to the simplicity and convenience they offer, shoppers are embracing new payment methods such as contactless cards, smartphones and wearables in record numbers. This is largely down to the fact that shoppers are increasingly embracing mobile. Therefore from coupons to receipt processing to promotions, retailers will increasingly adopt mobile as the platform of choice for their consumer marketing efforts. According to the DMA, today 80% of millennials use their phones in-store as part of their purchase process, providing retailers with plenty of opportunities to appropriately target these consumers and affect real-world purchases.
Right here, right now
Likewise brands and retailers are utilising platforms like Snapchat, Whatsapp and Facebook Messenger to instantly connect with consumers and offer superior levels of customer service. Retailers and brands are also using new technology to help consumers decide what to buy, watch, do or eat, based upon pending timeframes from the next 30 minutes to the next 48 hours.
Ease is the new loyalty
We have seen such a huge rise in mobile usage because it makes life easier. You can now get anything you want with the tap of a button. We are becoming loyal to the brands that are smartly using technology to simplify every aspect of our lives. The brands that do it best will create experiences that have you asking how you ever lived without them.
We recently commissioned research that looked into consumer expectations around their shopping and delivery experiences. We asked consumers what they love and conversely what they hate about online shopping. Convenience and ease not surprisingly featured highly. 82% of respondents said they love the convenience of online shopping, 90% love the ease of shopping, and 82% love that they can get what they want when they want it.
Shoppers want to be in control
Our research also showed that consumers want complete flexibility and control over when and how their parcel will be delivered. It also showed that shoppers have strong views around delivery price, services and timeframes. We know that the majority of shoppers now want delivery options that extend beyond the home. They also want more efficient services and the ability to be able to track their online orders and parcels every step of the delivery journey. That said, they appreciate and are quite prepared to wait for what they deem as non-urgent parcels. But they still want total visibility so that they know when their parcel will arrive, whether that is same day, next day or within a number of days.
Clearly how we shop and the shopping habits of consumers is changing and evolving all the time. Retailers are struggling to keep pace and to predict the shopper's next move, as is evident from the Tesco example that I shared at the start of the article. Technology, and in particular mobile, is fuelling this change. This evolution is set to explode in 2017 because 2016 data shows that the number of people accessing the Internet through mobile devices worldwide surpassed those using desktops. Consumers are fickle and switch from one retailer to another at the click of a button. Retailers must truly understand the ever changing face of the shopper and must constantly evolve their strategies in order keep pace and survive in a world where the competition is tough and the stakes are high.