With a few weeks of social distancing under our belt and the effects of the new stay-at-home-economy starting to emerge. In fact, we’ve already started to see certain shifts in consumer demands that we believe will be here in the long run.
We’re still in the beginning stages of what will become “the new normal” and there’s probably a whole lot more change coming our way in the next few months. With that in mind here’s a list of 5 interesting consumer shifts we’ve observed so far:
Here’s a bit of context to give you a better idea of what we mean:
Online shopping has been on the rise for years now, but its recent growth has exceeded most of the pre-Corona projections for 2020. Some of the contributing factors include:
- The closing of most non-essential brick-and-mortar stores, which has pushed more consumers to make their purchases online.
- Online shopping is providing buyers with a sense of comfort and reassurance that they can keep a similar lifestyle going.
- Advances in online connectivity; which have made it easier for consumers to shop online.
- Improvements in online consumer experiences.
- The convenience of being able to shop at any time, from anywhere.
In response, companies are increasingly making use of things like Machine Learning and Artificial Intelligence to stand-out in a sea of competitors with similar offerings. The practice is called “automated” commerce or a-commerce and it’s basically e-commerce version 2.0.
With social distancing increasing the demand for contact-free interactions, technological advancements like self-driving cars, delivery drones, teaching apps, and virtual assistants will become more of a necessity for consumers rather than a novelty.
According to Market Research Engine, the global retail automation market will be worth about $21bn by 2025. And that was before the stay-at-home economy.
With Covid-19 forcing retailers to go online to stay alive, more companies will be using automated technology to streamline their services and improve their customer experiences. Predictability and personalization will be the winning factors.
Smart interactive devices will use social media and past purchasing behavior to help retailers predict what their clients need. This will help companies create relevant promotions, store the right inventory and build products and services that more efficiently meet consumer demand.
Here are just a few examples of how retailers are using automation to fuel growth:
Additionally, online purchasing is likely to extend beyond the typical categories like books and electronics to more essential products, like groceries, medicine, and personal care products.
Direct to consumer (D2C) brands like Glossier, Casper, and Allbirds have been shaking up the e-commerce world for years now. They’ve made millions (some reaching the billion mark) in less than a decade. In fact, according to eMarketer, D2C sales are projected to reach $17.75 billion during the course of 2020; an increase of 24.3% from 2019.
With numbers like these, it’s no surprise that some of the world’s biggest corporations have already been experimenting with new ways to leverage the benefits of the D2C model. Here are just a few examples:
The D2C model is especially appealing in the new stay-at-home-economy because:
- D2C companies facilitate social connection and create a new form of social currency through their products and services.
- New offerings like live online workouts and “pub by delivery”, are novel and consumers are actively sharing them with their social networks – creating a wide array of opportunities.
With supermarkets and many known online retailers running out of things like alcohol and hand sanitizer, consumers will turn to less known retailers to get the things they need. This will make them more open to less familiar D2C companies.
In fact, a few corporations have already responded by making their own recent D2C pivots:
With companies testing out and perfecting new online schemas for everyday work (sales visits, team sprints, facility tours, etc.), you can expect some of them to stick past the lock-down (e.g. more people will be working from home, more processes will be automated, companies will shift their offerings to digital).
In other words, companies are no longer wondering about what technologies they should use. Instead, they’re thinking about new and creative ways to scale the digital technologies they’ve already tested to create more value.
If digital transformations were big before the stay-at-home economy, you can expect an even bigger push afterwards. The current situation has made the importance of automated processes and online services crystal clear, in a way that it just wasn’t before.
Companies will be more motivated than ever to future proof their businesses and upgrade their products and services to meet shifting consumer trends.
With social distancing keeping us at home, the time we would normally spend on commutes, the gym, grocery shopping or just hanging out with friends is suddenly back in our hands. The question now is: What can we do with it?
Many consumers are using the time productively to learn a new skill (e.g. new language or hobby), accomplish a goal (e.g. home decor, build a website, learn more about investing) or make other general improvements (e.g. tidy up that darn garage!).
No matter what the task, you can bet people are checking the internet for some sort of guidance to help break the process down and get things done in a fun and efficient way.
This is a great opportunity for companies that facilitate self-learning and DIY projects. Here are just a few examples:
MasterClass is an online education platform where you can learn directly from celebrated experts in various fields (e.g. filmmaking with Martin Scorsese, cooking with Gordon Ramsey, creativity and leadership with Anna Wintour, etc.).
People using these new learning sources are bound to continue doing so well past the lockdown.
We’re currently living through an era in which products and services are no longer the central focus for consumers. These days, it’s all about how memorable it is to shop, and the experience itself is a big part of what keeps consumers coming back.
Many companies are masterfully combining virtual reality (VR), augmented reality (AR) and mixed reality (MR) to create new ways to enhance their consumer experiences. Here are just a few awesome examples:
- Google Arts & Culture has teamed up with some of the world’s leading museums to offer virtual tours of various places around the world. Thanks to their efforts you can now visit The Met in New York, the Van Gogh Museum in Amsterdam, the Palace of Versailles and many more, all from the comfort of your home.
- Alibaba has been experimenting with virtual and augmented reality to make its users feel like they’re shopping in a store with other customers.
- QReal, formerly known as Kabaq enables users to visualize the food they’re about to order in restaurants or online.
- Roomy offers immersive 3D real estate tours, virtual staging services, and even interior design services through augmented reality.
- British Airways is testing out VR to take in-flight entertainment and wellbeing to the next level.
- The Park Playground enables its consumers to go on wild adventures to the future or the past through fun and very convincing VR experiences. They even offer options you can try from home!
With summer festivals, museums and sports leagues all over the world canceling their events, a growing number of people will turn to virtual experiences for entertainment.
Even after the social distancing restrictions become more relaxed, there will be plenty of opportunities for companies to use virtual experiences in industries like real estate, travel, education, and retail.
Focus on the future.
Although some of the trends described in this article can seem like something out of Star Trek, they’re pretty much universal at this point and apply to almost every industry. This is and will be the new normal for consumers.
Our hope is that the insights we’ve shared will inspire and motivate you to start your own digital transformation, innovate from the inside out and create new value for your target audience.