COVID-19 is creating a distinct divide when it comes to consumer shopping behaviours
The impact of COVID-19 has made consumers more conscientious about sustainability, with even more focus on the environmental, social and governance (ESG) implications of their purchasing choices. And, despite the deep effects of COVID-19 in the retail experience, in-store shopping remains the top choice for consumers who shop daily or weekly for goods where restrictions allow. These are some of the key trends revealed in PwC’s 2021 Global Consumer Insights Pulse Survey, a major study amongst nearly 9,000 consumers in 22 countries around the world, the results of which are published today in Ireland. While the study does not include Ireland, we believe based on our experience, that the trends herein are also evident in Ireland.
Despite the pandemic, in-store shopping remains consumers’ channel of choice for daily or weekly shopping. Despite lockdowns, 41% have purchased products (clothes, books, electronics etc) in-store when allowed in the last year, but is down from 47% the previous year. Mobile shopping continues to steadily accelerate - 33% globally have purchased via mobile on a daily or weekly basis, an increase of 10% on the previous year, and compares to 17% in 2018.
At the same time, around the world, across most product categories, even in places where pandemic restrictions were lifted, a greater number of people say they’ve been shopping more or exclusively online compared to shopping more or exclusively in-store. For example, for fashion, 53% said they are shopping more or exclusively online versus in-store (22%). The trend is similar for consumer electronics, health and beauty, sports and fitness, DIY and household appliances. Just for grocery, online (33%) versus in-store (32%) shopping is similar.
The survey reveals that when shopping online, fast and reliable service (42%) is the most important attribute. Stock availability (38%) and the ability to quickly and conveniently navigate the website (36%) are also crucial.
Online engagement extends to social networks, too. More than half of global consumers say they interact with the top four (Youtube, Google, Facebook and Instagram) digital platforms, and more than one-third of those respondents say they’re actively clicking on advertising. For example, 66% of respondents confirmed they interact with Facebook, with 41% stating that they click on ads relevant to them.
The research shows that in the wake of the pandemic, survey respondents across the globe are focused on making more sustainable choices. For example, 55% of consumers agreed that they buy from companies that are conscious of protecting the planet, and 54% agreed that they buy products with eco-friendly packaging. For grocery shopping, in particular, consumers across the board say that they’re willing to pay a price premium for healthier options (55%), local produce (50%) and sustainable packaging (46%), regardless of shopping online or in-store.
John Dillon, Parter, PwC Ireland Retail & Consumer Practice, said: “Consumers around the world have become far more sophisticated when it comes to sustainable choices. The research shows that no matter where our consumer and retail clients do business, they are and will be serving customers who want to know how they are doing their part to protect our environment and consider how their actions affect our climate. ESG is not a passing fad. Knowing what your consumers now value and changing how you now do business will define your own long term sustainability and growth.”
PwC’s analysis shows that COVID-19 is creating new groups of consumers that could herald long-term patterns in attitudes and behaviour. These groups are categorised as follows:
The research reveals that people working from home are significantly more likely to increase their spending over the next six months across all product categories compared to those who work away from home. Those working from home are also more likely to shop online than physically go into stores to shop. In particular, at-home workers are almost 10 percentage points more likely to shop online for groceries.
Those working from home are also much more likely to consider the effects of their purchases on the environment. For example, 64% of those working from home said that they buy from companies that are conscious and supportive of protecting the environment compared to 50% for those working away from home.
35% of Generation Z and 43% of Millennial shoppers are more likely to shop daily or weekly using their mobile phone than older counterparts. According to our analysis, COVID-19 has not impacted younger consumers’ spending habits. They are expected to spend more in the coming months than older consumers. For example, 36% of Generation Z and 33% of millennials expect to spend more on fashion over the next 6 months compared to just 4% for older generations.The survey also reveals that millennials, in particular, are more promiscuous shoppers, meaning they’re not as brand-loyal as their older counterparts. They tend to make less frequent, bigger-basket shopping trips.
23% of survey respondents rank “increased health and safety measures” as their top two attributes when shopping in-store. These individuals are shopping in-store less across all product categories. For example, 37% of this ‘conscientious’ group say that they are now shopping less for fashion items in physical stores compared to 29% for all shoppers. 23% of them say they are shopping less for groceries in physical stores compared to 18% for all shoppers.
When shopping for groceries, these consumers are also more willing to pay a premium for more environmentally friendly options and this is unlikely to change, even after the safety concerns brought on by COVID-19 subside. For example, 50% of the conscientious shopper is more willing to pay a premium for eco-friendly/sustainable packaging compared to 46% for all shoppers; 53% will pay a premium for locally produced products compared to 50% for all shoppers.
Compared to other shoppers, a greater percentage of the ‘conscientious’ group say they are less likely to venture out in the next six months. For example, in the next 6 months 63% of the conscientious group said that they are unlikely to travel on an international flight (even if allowed) compared to 57% for all respondents. 50% are unlikely to stay in self-catering accommodation (when allowed) compared to 46% for all respondents and 39% are unlikely to take public transport compared to 33% for all respondents.
Owen McFeely, Director, PwC Ireland Retail & Consumer Practice, concluded: The consumer markets industry was experiencing large-scale disruption well before the COVID-19 pandemic, but the virus accelerated the pace of change in consumer behaviour. As companies move forward, they should take advantage of opportunities the new trends bring. If those consumers primarily working at home do increase their spending, this creates an opportunity for retailers and brands to proactively engage with these consumers in order to win additional share of wallet.
“Both consumer companies and retailers should be prepared with innovations and changes, such as subscription offers, enhanced e-commerce capabilities, and larger, bulk packages for consumers who are at home more and spending more. Other areas of opportunity could be to enhance digital capabilities to improve efficiency. There’s no better time to move forward with bold, decisive actions, even as the sands keeps shifting.”
The survey report can be found at : https://www.pwc.com/consumerinsights
According to the survey, the top four digital platforms are: YouTube, Google, Facebook and Instagram.
For the 2021 Global Consumer Insights Survey, PwC polled 8,738 consumers across 22 territories but not including Ireland (Australia, Brazil, Canada, China, France, Germany, Hong Kong SAR, Indonesia, Japan, Malaysia, Middle East, Mexico, Netherlands, Philippines, Russia, Singapore, South Africa, South Korea, Spain, Thailand, United States and Vietnam). The respondents were at least 18 years old and were required to have shopped online at least once in the previous year. This research was undertaken by PwC Research, our global centre of excellence for primary research and evidence-based consulting services. www.pwc.co.uk/pwcresearch.
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