How COVID-19 Has Accelerated eCommerce Adoption

1241
man ordering online with mobile phone and holding credit cards

Consumers have been forced to change the way they shop, driving brands to adopt new methods of interaction even sooner than was previously anticipated. This article provides an overview of how consumer sentiment and adoption of eCommerce has changed in 2020, and how these changes should inform the marketing/advertising landscape this holiday season.

Digital Transformation is the introduction and adoption of new digital technology to transform services or businesses. COVID-19 has forced the steady change to hit an apex with the at-home consumer looking for ways to engage with brands.

Here’s how consumer habits have changed:

  1. Rise in eCommerce 

Growth in eCommerce in the first few months of 2020 has outpaced all growth from the preceding decade. Essentially, we’ve seen 10 years of growth in a matter of months. The consumer electronics category appears to be taking the lead, with eMarketer projecting that US computer and consumer electronics eCommerce sales will total $156.50 billion this year—and nearly half of the products sold in this category overall (49.5%) will be purchased online. 

Here are some of the ways brands can reach consumers in this eCommerce driven landscape:

  • Shoppable Content: Consumers are spending more time on social media, where they are more susceptible to native and in-stream ads. Explore the new advertising formats of 2020 (which include Pinterest, Shoppable TV, and more) to find which best engage your digital consumers.
  • Livestream Content: Video is increasingly impacting eCommerce purchasing decisions. Livestreams can be used in two ways: (1) influencers can create seamless product endorsements to their own audiences and (2) brands themselves can have better engagement with their shoppers on owned channels. 
  • Virtual/Augmented Reality: With the current stay-at-home reality, shoppers are much more receptive to digital experiences since they can’t try products in person. The tools to meet your consumers halfway already exists. Large social media platforms like Pinterest and Facebook have already added features like AR makeup try-on, while Facebook and Instagram are beginning to roll out AR-enabled ads and posts. Shopify introduced the ability for merchants to incorporate 3D models into product pages and has found that viewing 3D products in AR increases conversion rates up to 250%

 2. Rise in Purchases for the Home

With people spending so much time inside, it makes sense that hobbies at home are still growing. Back in April, home cooking and baking saw a 4x increase in social media hashtags compared to January 2020. Even now, the volume is still at around 3x what it was in January. DIY, Home Decor, Gardening and Crafting-related hashtag use have all seen an upward trend since March 2020.

Hand and hand with this trend is the increase in eCommerce sales for products to improve consumers’ at-home quality of life (cooking, exercise, crafting, home improvement). Ecommerce sales for cosmetics and personal care products have been on the rise as well, with small self-gifting becoming a growing trend. 

Yet to be determined is the digital transformation’s effect on holiday sales. Holiday shopping has started earlier than ever before as families look forward to a reason to celebrate the end of this year. 8 in 10 shoppers (82%) will do most of their holiday shopping online – and nearly 1 in 3 (30%) will do ALL of it online. Ecommerce giant Amazon is expected to generate $9.91 billion in worldwide sales, including $6.17 billion in the US. Brands should be catering to this changing trend by targeting marketing placements, creatives, and messaging for the at-home consumer this year.

3. Changing Consumer Sentiment 

The way brands deal with the crisis now may influence consumers in the future. Consumers have high expectations for businesses to act responsibly. People are looking to trusted brands to provide them with safety and security in challenging times. They want to be assured that the brands they choose are in control of their supply chains, and are transparent and trustworthy.

Even though eCommerce is in the limelight, many shoppers will still want to safely shop in-person. ArchiExpo magazine interviewed Jin Kim, Founder and CEO of advertising agency Creative Digital Agency, “I’m a believer in the digitalization of anything possible but people at the end of the day want interaction,” said Jin Kim. “The craving for physical interaction means it’s helpful for brands to have a physical presence in order to strengthen brand loyalty—to be a part of something that blends the two (digital and physical) well.”

Consumers are understanding of delayed delivery times. A new study by delivery experience management firm Convey revealed that sixty percent of respondents felt retailers deserved an extra 3-4 days for delivery, while 19 percent were comfortable with 5-6 days. And in what should be good news for retailers, a full 17 percent said more than 7 days was acceptable.

During the pandemic, this accelerated digital transformation has been a lifeline for the at-home consumer. Many digitally adverse users became adopters. But will they stay users?

  1. Which of these changes are temporary fixes and which are here to stay?

The largest number of eCommerce adopters during the coronavirus pandemic has been from Gen X and Baby Boomers, who are expected to maintain these habits even after concerns over the virus have subsided. 

Additionally, consumers are still choosing to stay at home, even after restrictions begin to lift. Surveys show that socializing at home will be preferred in the next 6 months. Despite lockdowns easing and many retail businesses reopening, the home will continue to be the hub of all activities. 

Socializing at home (or someone else’s home) is still the preferred option while connecting virtually with friends remains a high priority across all age groups. The initial rise in home cooking and baking, as well as home improvement and DIY activities, which was evident in our earlier research, are remaining popular pastimes for consumers. And working from home, once mandatory, has now been embraced by many and continues to be popular despite many offices reopening.

  • Will the accelerated transformation slow down as consumers go “back to normal”? 

Organizations that made early investments in digital transformation were less impacted by the sudden market shift as customer attitudes change. Of those transformations, eCommerce has been a bright spot among retail channels during the pandemic, as consumers became reliant on digital transactions amid physical store closures and fear of infection. 

As the economy slowly reemerges, it’s important that companies remain on this trajectory. Companies should accelerate and lean into change, not shy away from it, to better position themselves for the challenges and opportunities that lie ahead. Consumers are having to adapt in ways they were not anticipating, and that same openness to change is what they will anticipate from brands.

Subscribe

* indicates required

1 COMMENT

  1. […] Ecommerce firms continue to underestimate the impact of search on their results and customer metrics. Instead, they pull their attention and resources towards the site layout and navigation, managing product categories, and handling inventory issues. While these are very important variables, all that work is for nothing when paired with poor search. Customers can’t buy what they can’t find. […]

LEAVE A REPLY

Please enter your comment!
Please enter your name here