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  • What You Should Know About Online Shopper Behavior Changes Over the Past Few Years 

What You Should Know About Online Shopper Behavior Changes Over the Past Few Years 

By Debutify CORP | Oct 04 2022 |

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What You Need To Know About Changes In Online Shopper Behavior

Any self-aware person understands that their habits and behaviors have evolved over the years. The global expansion of internet products and services has transformed how we live, entertain ourselves, socialize, work – how we do anything. But if we understand how meaningful these changes are to us as individuals, can you imagine how essential the change in overall consumer behavior is for companies in the eCommerce industry? 

Online shopping behavior is a highly complex phenomenon that’s constantly evolving, especially now that the global pandemic has completely disrupted the “normal way of life.” Therefore, companies that want to sell their products or services online must learn as much about their customers as possible. 

Here are some of the crucial consumer behavior changes you should know. 

 

Growth of online sales 

The shift to online shopping is nothing new. Younger consumers have relied on eCommerce companies like Amazon, Alibaba, Walmart, and Home Depot long before the first cases of COVID-19 hit. However, the global pandemic has truly pushed online sales over the edge. 

While eCommerce stores have been gradually increasing profits since 1998, sales have skyrocketed since the start of 2020. There was a sudden increase of over 43% during the first year of the pandemic, with the trend only set to continue. 

Even consumers who used to shy away from online purchases have now transformed into experienced online shoppers who get everything from groceries to household care products, cosmetics, apparel, electronics, and more from eCommerce retailers. There are now between 15% and 30% more online shoppers in most product categories. 

Even though customers have spent $32 billion more on online shopping due to the rising inflation in 2022, they still prefer online retailers, and for a good reason. After all, eCommerce stores offer many benefits over in-person shopping experiences: 

  • Greater convenience
  • A wider variety of products
  • Better online discounts
  • Detailed product information
  • Informative recommendations and reviews
  • Same-day deliveries
  • Seamless replacements and refunds

Not to mention that they can safely socially distance themselves and avoid crowds – a valuable perk, pandemic or not. 

Of course, while this massive global shift to online shopping has presented new, lucrative opportunities for eCommerce retailers, it’s also exposed some of their biggest vulnerabilities. Supply chain issues and general inventory problems have made it more challenging to fulfill online orders and ensure customer satisfaction. 

Order fulfillment starts from the moment a customer has placed their online order, involving processes such as product procurement, warehousing, inventory management, packaging, accounting, and shipping. An issue with any one of these processes creates a domino effect that can ultimately harm the customer experience. 

Supply chain bottlenecks can slow down delivery times; poor inventory management practices can lead to shipping mistakes; packaging mistakes can cause product damage. Even a minor fulfillment and delivery issue can lead to financial losses, costing you your customers sooner or later. 

To stay competitive, online retailers need to enhance their logistics, perfect their supply chains, and develop scalable solutions that can help them grow. 

 

Growth of OTT platforms 

Growth of OTT platforms 

It’s not only online retailers that have enjoyed increased success since the beginning of 2020. Unsurprisingly, as people started spending more time at home during the pandemic, they also started spending more money on in-home entertainment – consumer spending went up 21% in 2020 alone.  However, instead of investing in traditional entertainment such as cable and TV services in the initial stages of the pandemic, they prioritized OTT platforms. 

Over-the-top (OTT) video services platforms such as Netflix, Disney+, Amazon Prime, Hulu, and HBO, to name but a few, have seen a significant rise in their user bases over the past couple of years. 

In the US alone, over 78% of all households have at least a Netflix, Amazon Prime, or Hulu subscription. Over 24% of all households report that they have three more OTT platform subscriptions in 2022 than they did in 2021. 

The main reasons users choose OTT platforms over traditional TV services include immediate access to content, fewer ads, personalized recommendations, original movies and series, and cross-device compatibility. 

However, there’s a catch, one that users are getting more and more annoyed with. To enjoy everything the most popular streaming platforms have to offer, many consumers need to spend upwards of $75 a month. After all, each OTT platform has unique content that users can only unlock with a subscription, which is one of the reasons for the slight uptick in traditional TV usage at the beginning of 2020. 

Still, users continue to get away from the TV and are focusing more on personalized OTT services. While it’s unlikely that streaming platforms will continue with their growth spurts post-pandemic, revenues will stabilize, and consumers will keep relying on on-demand entertainment services. 

Similar trends are to be expected in the eCommerce sector as well. While the pandemic has brought about an online shopping boom, there could be a decline in the number of online shoppers as things stabilize over the coming months. 

However, if there’s something you could learn from the aforementioned OTT platforms, it’s that consumers are prioritizing personalized products and services. Therefore, investing in personalization is the key to maintaining reliable cash flows and attracting more customers. 

 

Millennials continue to lead in online purchases 

As previously mentioned, younger consumers are leading the transition to online shopping. Whereas the boomer generation (those born between 1946 and 1964) has been the slowest to hop onto the bandwagon and start using internet-based services, the millennial generation (those born between 1981 and 1996) accounts for the largest group of online shoppers. 

In the US, over 20.2% of all online shoppers are millennials, closely followed by generation X (those born between 1965 and 1980). Generation Z (those born between 1997 and 2010) is slowly taking over the reins, but it will be a while before they become the leading consumers. 

Considering that millennials are the largest generation in the workforce at the moment, it’s expected that they’ll continue to lead in online purchases as they generate more income. 

As a rule of thumb, eCommerce companies that need to increase revenue, boost sales, and improve their profit margins will find it most beneficial to target millennials and gen Z, developing customized solutions to suit their target markets’ lifestyles and preferences. 

 

Customers are more careful and focused on value 

Customers are more careful and focused on value 

Just three or four years ago, online shoppers mainly focused on buying non-essential items at eCommerce stores. Think of gifts for friends and family members, accessories, apparel, and similar things. They would purchase any item of value in-store. However, the onset of the pandemic has changed this trend. 

Consumers are now getting everything they need online – from the food they eat to the medicine they take. However, some of the product categories that have experienced the most significant growth during the pandemic include pet supplies, sporting apparel, cosmetics, and electronics. 

In any case, many essential and non-essential purchases today happen entirely online. Therefore, quality and value are the most important aspects every shopper considers. 

Consumers are choosing brands that offer greater value, lower price, and better convenience because they now have access to any online retailer that offers deliveries to their region. Retailers who want to remain competitive need to deliver the utmost quality if they’re to enjoy better customer satisfaction. 

 

Customers are no longer loyal to brands 

Finally, brand loyalty has been one of online shoppers' most significant behavior changes in the past few years. Consumers no longer stick to brands simply because they like their products or services. 

Even among frequent shoppers, over 24% of consumers state that they’re not loyal to any brands as they did nothing to encourage loyalty. They’d quickly change retailers if another company offered better prices or more convenient shopping options. 

Of course, that doesn’t mean that brands should abandon their loyalty programs and stop encouraging customers to return. Quite the contrary, it’s critical for companies to put in the effort to inspire brand loyalty and nurture their relationships with each customer. 

Take specific measures to overcome these consumer changes. Reward loyal customers with discounts and highlight them in social campaigns. Link your company to awareness and charity efforts your customers prefer. Showcase your culture and humanize the interactions they have with you. And don’t forget to create reasons for people to buy with you that overcome drawbacks like being more expensive or only offering online sales. Traditional brand loyalty is being replaced by a deeper, personal connection that takes more work but can still significantly improve customer lifetime values.

 

Bottom line 

Even though the global pandemic dramatically sped up the growth of online shopping, it also turned back time in a way. Companies need to return to some fundamentals and provide value to their customers if they want their loyalty. 

At the same time, consumers are careful about how they spend their money, and they want products that will help them in some segment of their lives – while not overpriced.

 

Author's bio:

Jake Rheude

Jake Rheude is the Vice President of Marketing for Red Stag Fulfillment, an eCommerce fulfillment warehouse that was born out of eCommerce. He has years of experience in eCommerce and business development. Jake enjoys reading about business and sharing his experience with others in his free time. 

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