During the week of March 15, the search term “toilet paper” reached peak popularity on Google, or a value of 100. For comparison, the value of that search term in February 2020 and again in April 2020 hovered around 2 or 3. It’s likely most of us searched Google for “toilet paper” in a desperate attempt to find some in stock online.
How has online shopping changed since this wave of panic buying in late March? This blog explores trends collected in the Selligent Global Connected Consumer Index. We compare this information with the trends and patterns we’ve seen from our clients at Retina.
Make It a Habit
The pandemic increased the frequency of online shopping. Before COVID-19, shoppers were more likely to make online purchases on a monthly basis. During COVID-19, more consumers are shopping online every week.
- 31% shopped online monthly
- 28% shopped online weekly
- 22% shopped online monthly
- 36% shopped online weekly
In the past, consumers purchased non-essential or hard to find items online. Now, many consumers are turning to online shopping and subscription services for essential items like groceries, household products, and toiletries.
While there was a spike in shopping at stores and online during March, as shoppers aimed to stock up on items, the frequency of shopping trips has adjusted to a new normal. Whereas before the pandemic, a consumer may have visited the grocery store and pharmacy every week for essentials, she now gets groceries delivered and signed up for a subscription service for self-care products.
When trying to analyze customer behavior during a worldwide, unexpected event like COVID-19, it’s important to rely on a customer model that is resilient to large scale trends. By focusing on customer lifetime value, brands can ensure they are focusing on longer lasting behavioral shifts instead of short-term trends. For example, purchasing essentials like self-care products online is a more resilient trend to focus on than panic-driven buying of paper products.
Add to Cart
During the pandemic, 60% of online shoppers prioritized purchases of essential items. This trend was especially transparent during March when it became difficult to find items like toilet paper, non-perishable foods, and cleaning supplies in stores. While most of this panic-induced purchasing behavior decreased rapidly, many items like paper products and disinfecting sprays and wipes were difficult to find for months.
Shoppers also focused on essential items because many consumers lost their jobs or worked fewer hours or for reduced pay. As we enter the seventh month of the pandemic, these are the top non-essential items consumers purchases online:
- 24% digital entertainment
- 18% alcohol
- 15% apparel
- 11% home improvement
- 11% non-digital toys, games, books
- 4% travel for future
With consumers spending more time at home, digital entertainment and alcohol topped non-essential purchase categories. Before the pandemic, shoppers focused more on entertainment purchases like movie tickets, concerts, and other in-person events, but turned to digital entertainment as in-person events were cancelled or postponed.
Consumers anticipate to buy from the following categories in the next 6-12 months:
- 17% apparel
- 14% digital entertainment
- 13% business/home office supplies
- 12% home improvement
- 12% alcohol
- 11% travel for future
- 9% other
- 8% non-digital toys, games, books
- 4% online gym/workout tools
The biggest shifts in anticipated spending are apparel, office supplies, and travel. Apparel and travel suggest that some consumers are planning or hoping to return to a new normal, perhaps going back to work and starting to travel again. However, office supplies other consumers are planning to work and study from home for an extended period.
The future is uncertain, so it’s important to focus on metrics like customer lifetime value instead of short-term revenue bursts. In addition, because shopping behaviors are changing rapidly during the pandemic, it’s important for brands to optimize their campaigns in real time. If marketers must wait for 4 or more transactions to determine a campaign’s efficacy, it’s often too late. With early CLV metrics, brands can capitalize on trends now and prepare for future shifts in online buying behavior.
Of course, consumers are looking forward to getting back to normal, or reaching a state of new normal. If and when that happens, consumers plan to shop in the following ways:
- 39% mix of online and in-store
- 28% continue mostly online
- 24% can’t wait to shop in-store
- 10% haven’t planned that far ahead
Almost a third of consumers plan to continue shopping mostly online. This shift in behavior seems to be here to stay for some consumers. With individual level customer lifetime value, brands can pinpoint who these customers are, and market to them accordingly.
Overall, more consumers are shopping online, especially for essential products. While inspired by the pandemic, this trend seems here to stay, at least for a large subset of consumers. Brands and ecommerce companies can use customer lifetime value metrics to find high-value customers who will continue to buy, whether online, in-store, or both.