As vaccinations lead the way toward reopening the economy, a look at the trends of the past year can offer insight into how consumer-facing industries can prepare for the reopening.
Our earlier analyses offered clear evidence that consumers are spending more time online. And they increased online shopping almost 40%. In response, companies are blitzing through their plans for digital transformations, reporting that they advanced to year two or three of their five-year plans within the first few months of the pandemic.
Companies that pivoted quickly to reconfigure operations for optimal customer convenience have a clear advantage. Here are five pandemic-accelerated trends that will likely dominate the reopening:
As consumers experienced lifestyle changes—with new approaches to work and school and entertainment—over the past year, they also experimented with new brands: 50% switched out familiar brands for new ones, and almost 65% of them to stay loyal to those new brands.
While Amazon still dominates online shopping, younger consumers are open to other online options. They told us speed and flexibility matter. The ability to have an item shipped directly from a brand’s website as well as local stores and curbside pickup are among the reasons younger consumers say they’d switch loyalties to a different retailer.
75% of consumers said they expect companies to do their part to maintain the unintended environmental benefits resulting from the pandemic. Younger shoppers are especially interested in the environmental, social and governance (ESG) practices associated with the products they buy.
Consumers are looking for reasons to try new brands. Find out what appeals to them by putting your customer data to work for you.
Curbside pickup has understandably surged in popularity during the pandemic because it offers consumers a combination of speed, value and convenience. They get their items sooner than home delivery, avoid shipping costs and minimize health risks by staying in their vehicles.
And the upside for retailers? Not only do they offer consumers an additional fulfillment channel, they can now use stores—typically located closer to consumers than warehouses—as fulfilment centers. In fact, same-day pickup from stores for online orders can save a retailer as much as 90%, compared to shipping an order from a warehouse.
While curbside pickup may level off post-pandemic, it does offer long-lasting lessons: Consumers continually adjust buying decisions based on individual preferences for speed, value and convenience.
Younger consumers (17-38 years old) use curbside pickup at double the rate of shoppers 39 and older (49% v 26%).
Leaders at consumer-facing companies understand they need to offer consumers the combination of speed, value and convenience they seek. Our analysis finds they are more likely than executives in all other sectors (47% vs 38%) to commit to a large increase in digital investment in 2021.
Free shipping is what attracts customers in the first place—and then keeps them coming back. It makes the difference in brand choices for more than two-thirds of consumers (68%), ahead of free samples, loyalty programs and curbside pickup. In fact, close to half of all consumers (42%) see free shipping as significantly important to their purchasing decisions.
Free returns are also a competitive differentiator: As consumers extend the variety and purchases they’re willing to make online—from apparel and footwear to accessories and electronics—return policies take on even more importance. Our analysis shows that 53% of consumers make buying decisions based on return policies.
Not only does a clear, easy return policy drive loyalty, it can also lead to future conversions: When retailers offer the option of buying online and returning in-store, consumers often end up leaving the store with additional purchases.
Millennials (25-38 years) are the most focused on return policies of all age groups because they return items at double the rate of all consumers.
Consumers make no bones about their preference for free shipping. Retailers who deliver have a clear competitive edge. Brands making inroads into direct-to-consumer channels or affiliating with a marketplace need to assess the economics of shipping costs in their overall strategy.
The majority of consumers (71%) are confident their online transactions are secure, likely because:
That trust has value for retailers: When consumers trust you and believe you have something of value to provide them, they willingly share their data. Our analysis has found they don’t always know what they are getting in exchange for their data.
It’s up to retailers to educate consumers. Tell them what data you need. Tell them why you need it. Tell them what they will get in exchange for sharing it.
70% of consumers believe the benefits of sharing data outweigh the risks. 80% of are willing to share data with a company they trust.
Despite all signs pointing toward an end in sight, retailers are well advised to continue safety precautions for the foreseeable future—to reassure consumers that they are safe in their stores.
Masks for workers and other shoppers top the list of safety measures that reassure consumers, followed by capacity restrictions, the availability of hand sanitizer, regular store cleanings and temperature checks.
Millennials and boomers alike told us safety protocols are essential for in-store shopping.
Reassure consumers with appropriate safety measures so they are comfortable shopping in stores. And be sure to communicate your safety measures effectively via signage and ongoing digital updates.
The key challenge for retailers will be reconnecting with in-store customers while deepening online relationships, ultimately ensuring they are meeting customers in whatever combination of channels they seek. They will require a robust omnichannel infrastructure that links all physical and digital channels.
Whether online, instore, curbside or mobile, success will involve not only staying current with each channel’s evolving opportunities and constraints, but also using the data from that cross-platform engagement to build unified customer profiles flexible enough to respond to changing customer preferences.
Consumer Markets Industry Leader, PwC US
Consumer Markets Tax Leader, PwC US
Digital Products & Consumer Markets Advisory Leader, PwC US
Consumer Markets Assurance Leader, PwC US