It is often said that the only constant is change itself. However, the changes in consumer behaviour since the coronavirus crisis began are reshaping the retail landscape faster than anyone could have imagined.
The ongoing economic impact of the pandemic is having a profound effect on retail, putting many, particularly high street retailers, under significant strain. It has, however, also significantly accelerated the shift to e-commerce, with previously reluctant consumers turning to online shopping, many for the first time. According to research by Astound Commerce, online sales across the UK and Europe surged by 129% week on week from March to April 2020, during the peak of the outbreak. As restrictions ease, e-commerce habits developed during the pandemic are unlikely to reverse any time soon.
As a vital part of the retail supply chain, at DG International we have many different vantage points to view consumer behaviour. These are the trends we’ve noticed over the past few months from our position in the warehouse and out on the road:
The broadening of the online shopper profile has had an impact on the types of purchases being made online. An older population, who may have been hesitant to buy goods over the internet pre-COVID, have now chosen to shop online, rather than venture onto the high street or supermarket. Home deliveries from pharmacists, subscription purchases and grocery orders have all increased substantially.
While fast fashion took a hit, food and drink subscriptions became even more popular. Pernod Ricard UK, for example, recently announced that online sales of its spirits increased by 92% for the year.
With supermarket delivery slots largely booked up in advance during the virus peak, many turned to subscription services, such as Gousto, for their weekly food shop. And it’s not only food being delivered in a box. Retailers such as Hotel Chocolat, Nespresso and Majestic Wine all offer subscription services. We will be keeping an eye on how the fashion industry responds to this trend in the coming months.
We’ve also noticed a rise in online purchases that would usually require in-store consultation or more consideration in person, such as dishwashers, a new sofa or even a kitchen countertop.
In addition, desk chairs, headsets and printers have all seen an uptick as employees adjust to working from home. The demands of the home office were sudden, and consumers have added these to the list of click-and-buy items.
Another, somewhat unexpected change in behaviour, is that product returns are down, even months after the peak. During the height of the pandemic, this could be attributed to the added complexity of returning goods. However, the type of items being purchased has also played a part as well as a shift towards more considered purchases.
The speed at which consumer demand has shifted forced retailers to respond quickly, with logistics partners at the forefront of ensuring agility in the supply chain. DG International was in a fortunate position when COVID-19 hit, having recently completed our own digital transformation. Moving all our internal processes and customer transactions online meant we were able to quickly adapt and support our retail partners more efficiently.
We learnt a lot during the past few months, but one thing that has been made particularly clear by the continued surge in e-commerce demand is that digital transformation is no longer optional for survival.