Changing shopping behaviours

8 December 2021

During 2021, the retail industry experienced a surge in sales by 46% online and 20% in store. New findings show that younger people are spending more money on less products, and that the age-group 65+ is increasing their online-shopping remarkably. How are retail companies adjusting to this new reality and what can they expect for the future? The Link spoke to Malena Kirs, Marketing Manager at SCC member Voyado, discussing the retail trends from 2021 and giving her best advice going into 2022.

Voyado is a leading customer experience platform for e-commerce players and retail, providing actionable customer insights and tools for building precise, personalised customer communication. Every year, Voyado releases a report to provide the industry with data and hard facts about the shopping behaviours of end-consumers. “The 2021 report is based on aggregated and anonymous data from 16 million purchase occasions. There is a lot of depth in these reports and lots of knowledge to collect,” says Malena.

Online purchasing power
Looking at purchasing power online, we find the middle-aged people the strongest. “Many of the consumers included in these groups are individuals who have worked their way up in their careers, and have a stable, as well as higher income than younger people. Many also have children which they still provide for, resulting in them spending more money since they aren’t only shopping for themselves,” Malena says.

65+ moving onto the digital stage
The report shows that the age-group 65+ are substantially increasing their online shopping, up by 24% in 2021. According to Malena, we need to realise that 65+ aren’t the same type of consumers today as they were a couple of years ago. “This should not be considered an old age-group anymore. The 65+ of 2021, and even more so the future vintages, are digitalised people. We need to switch focus from the perception of this age-group being less able to navigate online, to recognising them as a new, and powerful target group for online retail.”

Young people are spending more on less
A brand new trend showing in the report, is that the younger age group, aged between 18-25, are now spending more money on fewer products. “It is a shift that we are seeing, which I believe has to do with younger people caring more about sustainability. It is something that they talk about a lot, and it’s important for them to feel that brands they are shopping from feel the same. Therefore, they buy more expensive products that last longer, resulting in them avoiding shopping as frequently.”

Personalisation is everywhere – retail industry falls behind
Personalised emails go a long way the report states, with an increase in both open- and click rates for all age- and gender groups during 2021. Companies also increased their sending of personalised emails by 76% in the past year. “Personalisation is everywhere, and it is super popular. You can, for example, see advanced personalisation on services such as Netflix or Spotify, where the content is tailored to your preferences. The retail industry, however, has been behind in this area, but is now starting to catch up – and when it does, it is going to make a huge impact on future shopping experiences,” says Malena.

Key trends in 2022
1. First-party data becomes more and more important as authorities and browsers regulate the market for data collection and consents – and we see the death of third-party cookies. You will now need to collect first party data to create personal customer experiences. Start thinking about how you will handle this data, as well as what your value proposition will be for customers to want to give it to you.

2. After the Covid-19 restrictions ease, omnichannel will get its big boost. Even though online-shopping has increased tremendously during the pandemic, the stores still serve a purpose. Think about the different functions your e-commerce and store will serve, why should a customer move between them and how do you make sure that they do? For example, through a unique assortment, a Click & Collect solution, or special experiences in store.

3. Loyalty programmes will make a strong comeback in 2022. It’s essentially a must now since it’s so difficult to differentiate yourself when e-commerce is growing rapidly. The possibilities are endless, find out what is important to customers and reward them when they shop with you – loyalty is a two-way street.

4. Embrace personalisation. Customers expect personalised experiences, both in communication, on website and in store.

5. Ransomware and other intrusions into company data are becoming more and more common. If you have not invested in an information security system yet, now is the time.