It’s no surprise that a lot of our routines and day-to-day norms have dramatically changed since last year. From the way we look after our health to how we interact with each other in person, the Covid-19 pandemic has resulted in the world as we know it quickly shifting.

The effects that the past year has brought upon us are still here to stay for a while, including how consumers behave in an ever-changing retail landscape.

🛍️ How and what we buy has drastically changed.

Due to the global pandemic, many industries had to adapt to a digital-first mode of operation to work around store opening restrictions and city or countrywide lockdowns.

This meant ecommerce went gangbusters. A study by Adobe Analytics found that U.S. ecommerce sales rose 42% in 2020, while the Mastercard Economics Institute reported that consumers spent $900 billion more online in 2020 alone! This showed the growing need for businesses to meet consumer demands using contactless and safe sales methods such as click-and-collect and subscription models.

🛒 Ecommerce in 2021 took off to a great start.

Sales aren’t slowing this year, either. According to the Wall Street Journal, consumer spending on goods this May was already 20% higher than in February 2020. This number is estimated to grow another 9% in overall consumer spending this year, which is the fastest rate we’ve seen since 1946.

The ways that we’ve adapted our buyer behaviour over the past year are likely to stick around, too.

Approximately 45% of consumers will keep the shopping behaviors they adopted during the pandemic as “habits” that will continue after it comes to an end. One-third of U.S. shoppers plan to continue buying many items, such as clothing and groceries, online. And 78% of Americans still intend to shop online with the same or increased frequency as before, saying that convenience and safety are compelling benefits to keep adding things to their digital carts.

📈 So, what does all this mean for businesses?

Good news for ecommerce businesses: we can expect to see the sales continue into the upcoming key holiday months. But you might be thinking, what can we predict about consumer shopping behaviors as we prepare for a post-pandemic world? And what sales categories small businesses get involved with now ahead of these shopping sprees?  

If you’re curious about what shoppers may want to buy for post-pandemic times, read on for expert insights from Caila Schwartz, senior manager of Consumer Strategy & Insights at Salesforce.

Q&A with Caila Schwartz

Caila Schwartz is a senior manager of Consumer Strategy & Insights at Salesforce. She has experience in data analysis, consumer behavior, and storytelling, which helps her form stellar retail strategies for businesses.

The pandemic has changed how consumers shop, and what we’re likely to shop for moving forward. What have been some of the biggest behaviour changes you’ve seen in shoppers so far?

There were a lot of changes over the past year! The biggest shift was the large migration to digital shopping, especially amongst the older generations that resisted the digital trend prior to 2020. In fact, according to our data and research, we saw a 40% increase in net new online shoppers last year across the globe. By far the largest increase in new online shoppers we have ever seen. But they weren’t just buying online, they were also using new channels to discover and research new products and brands.

The share of ecommerce traffic coming from a social media referral grew by 56% last year, but it was the growth from Tablet devices which was the most impressive. Tablet users, who tend to skew older, saw their share of ecommerce traffic coming from social referrals grow by 73% over 2019, reaching 12% of all tablet traffic. And they’re even buying on these channels.

Six-out-of-10 Gen X’ers said they’d purchased an item after having seen it on social. Eight percent of them said they often make purchases directly within a social media app. The trend can also be seen for Baby Boomers. One-in-five have shopped directly within social apps at some point.

What are your predictions for product categories that will see a sales surge in a post-pandemic world? Are there any new categories businesses should think about adopting or pursuing post-pandemic?

I see consumer spending evolving into 3 main categories: adventure & travel, social, and luxury.

Goods and services that enable consumers to get back on the road are going to see either continued or big surges throughout the year. This includes sporting goods, luggage, and resort wear.

Within the social category, it’s going to be about goods and services that enable people to host parties, weddings, and all types of social gatherings we’ve missed out on over the last year. This means party supplies, dining and home entertaining goods, and even furniture.

And finally, we see consumers splurging on luxury investment pieces that they can show off at these social gatherings. Luxury jewelry, apparel, footwear, and handbags are all seeing big gains right now despite Q2 softening across the industry.

What can businesses do to prepare for the world opening back up? How can they provide consumers with a comfortable shopping experience in a post-pandemic world?

It’s all about convenience and bridging the gap between the physical and digital shopping experiences. Engaging consumers on the channels and devices that they prefer to use, providing multiple options for fulfillment – shipping, Buy Online Pick-up Instore (BOPIS), curbside, delivery – and removing the barriers between the store and online experience are table stakes right now.

Even as consumers head back to the physical store, they are still maintaining much of the digital behaviors they adopted over the past year. This means finding ways to continue to blur the line between the physical and digital experiences.

Inventory availability, BOPIS or curbside, in channel service (such as through SMS or social media), and intelligent offers and marketing are some of the key areas where those walls will break down.

Ecommerce sales rose tremendously due to the pandemic, and some businesses may be fearful they will see a decline in online sales now cities are opening back up. What can ecommerce businesses do now to retain consumers that became customers over the last year and keep them interested in spending digitally?

This is definitely a concern we are hearing across the industry, but our data is showing that much of those digital habits that consumers adopted over the past year are continuing to stick around.

While we anticipate a soft Q2 (either slightly negative or flat year-on-year spend growth), we will see more “normal” growth in Q3 and Q4 (10% to 15%). Consumers aren’t reverting back to past behaviors, so don’t abandon all the changes you made over the past year.

In order to continue to attract and retain customers via digital, it’s about continuing to be agile, understanding the wants and needs of your customers, and pivoting quickly and intelligently to deliver on those expectations.

A big part of understanding your customers is having a strong strategy for your first party data. Not only collecting the data, but having methods to structure, analyze, and ultimately put that data into action.

Being able to respond quickly to consumers changing preferences is critical to providing a great digital experience that will keep your customers coming back. In fact, according to our research, 84% of consumers agree that the experience a company provides is just as important as its products and services.

Based on your research, what do you think the online and offline retail landscape will look like in 2022?

I think we will continue to see an acceleration towards brands and retailers bridging the gap between the physical and digital shopping experiences. This means even better fulfillment experiences via BOPIS (click-and-collect) and curbside. It also means better inventory management and demand planning to move inventory closer to the sources of demand.

I also think we will see brands and retailers moving their experiences off property. That means embedding their brands into the channels their customers already are such as social media, but also into emerging channels like gaming. Live streaming, social commerce, and embedded shopping experiences will continue to become more mainstream. I think it will become rarer that we will transact directly on the brand or retailer’s website.

Have you seen any other unexpected shopping trends arise out of your research so far this year?

The biggest change I’ve seen this year (besides the massive acceleration to digital) is the emergence of social as a key channel across all generations. Social media’s influence in commerce continues to grow in 2021.

We are also seeing a shift in consumer spending interests right now. Luxury goods are seeing big growth over 2021 as consumers shift to goods they can invest in as well as show off as they reclaim their social lives.

But something that’s also really interesting to me is that our lifestyles have changed and perhaps permanently. Despite offices reopening, many workers will continue to work remotely or switch to a hybrid type working situation. This means that people will continue to have more time at home so they will continue to invest in their homes. That’s why we are still seeing furniture grow at very aggressive rates, even despite the supply and pricing issues that industry is facing.

Consumers are also spending more time outdoors now that they are no longer taking long commutes into work. Sporting goods and gardening equipment is a sector seeing very strong growth continuing into 2021. I think the modern consumer post-Covid has settled into a new way of life and I don’t think that we are going backwards.

What are your top three tips that you would give to businesses right now to prepare for the upcoming holiday season?

The first recommendation is to plan for consumers to start shopping early.

I am anticipating an Amazon Prime Day Round 2 in October. And with continued logistics delays, consumers will be looking to buy early again this year. Don’t wait on Cyber Week to begin your promotional calendar.

Second, we are continuing to see manufacturing delays and shortages. This is putting a huge strain on inventory and pricing. Think about how you communicate this to shoppers, especially if you have to increase your pricing.

Other options are to take pre-orders for more accurate demand planning and buying capacity now for late season container shipments. And finally, we are moving into a cookie-less internet. That means that first party data is going to become even more important as digital and social media advertising become less effective and more expensive.

Areas to focus on are loyalty programs, organic social engagement (including influencers), and intelligent marketing (automated email segmentation and right message, right time, right person emailing via artificial intelligence).

Wrapping it up 📦

New horizons are upon us, and shifting shopping habits are sure to add to the success of booming ecommerce sales for months to come.

Now is the time to be agile and flexible as we enter the latter half of the year. Take these expert insights to get your business all set for the approaching holidays, which will undoubtedly be a peak season like we’ve never seen before!

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For more consumer insights, follow Caila Schwartz on Twitter!

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