5 Key Consumer Trends to Watch Out for in 2021
By: Ebusiness Institute
Tags: Ebusiness, Consumer, 2021, Strategy, Trends

2020 will undoubtedly go down in history as the year that witnessed a worldwide pandemic, the year that saw unprecedented changes to consumer trends on a global scale. But what is the likelihood of those changes remaining in 2021 as the new normal for online shopping?

Is online shopping set to maintain its current high level of activity?

Will we drift back into what’s left of the physical brick-and-mortar shopping experience when lockdown restrictions end, for no other reason than we crave the memory of crowds and in-store jingles? Or will 2021 consumer trends remain aligned to the growth levels of last year?

Last summer, eBusiness Institute identified 5 megatrends that will help shape the post-COVID world, and now we can compare those with the top 5 consumer trends set to impact shopping behaviours this year.

Will the online shopping trend be abandoned in 2021?

Mature shoppers grow accustomed to eCommerce

In 2020, the number of older online grocery shoppers in the UK trebled. 23% of over 55-year-olds are now regular online shoppers compared to just 8% in 2019[1]. It is fair to assume that this trend is replicated globally.

This incredible growth was driven by lockdown, a fear of public places due to vulnerability and the convenience of online ordering. The older shopper uses technology to purchase the weekly grocery shop rather than luxury goods or entertainment.

But what might convince older shoppers to stay online once lockdown restrictions end? 41% of over 55-year-olds cited convenience as a reason to shop online[2], and if brands offer flexible choice of collection or delivery, especially fast delivery (Amazon Prime customers enjoy next day delivery on many lines), it will help to retain eCommerce loyalty.

Flexible order fulfilment

Convenience is king — Image source: shutterstock

Many brands have introduced differing methods for processing and shipping a customer order when placed online. When the logistical chain operates smoothly and delivers a fast and accurate fulfilment service, it definitely enhances the whole customer experience, but there are pitfalls to be aware of. You’re only ever as good as your slowest carrier!

Buy Online, Pick Up In Store (BOPUS) is used by 34% of consumers, whilst 31% prefer a kerbside collection[3]. There are clear benefits in having reduced contact, both for public and employee safety.

In the early stages of the pandemic, many brands were caught out by both a surge in orders and the speed at which change was happening, and they were unprepared to cope logistically. Most have now rectified the teething problems and are able to offer a choice of pick-up window, aimed at providing enhanced convenience for the shopper.

To make this happen, many brands introduced bespoke pick and pack technology. The use of real-time inventory and warehouse management systems — delivering intelligent, just-in-time replenishment ­­– helps to eradicate stock level errors and avoid the disappointment of product unavailability.

Consumer eCommerce loyalty can be driven by continued efficiency and improvements in offering flexible delivery options that are fast and reliable and which meet or exceed the expectations of the shopper. Beyond that, brands must not lose sight of the fact that the whole end-to-end process from advertising to fulfilment should aim to connect with consumers both emotionally and practically. A vital area brands must revisit is product and website eContent. There’s no point in having logistical excellence if the online ecosystem of content is not attracting audiences.

2021 Consumer trends related to online gaming

With the closure worldwide of entertainment venues from bars to theatres, many people are turning to gaming as home entertainment. In just six days in March 2020, the worldwide sales of game consoles (4.3 million units), showed a whopping 63% increase from the previous week[4].

It is no surprise that mobile gaming is strong, as it’s the most accessible platform with which to reach a wide audience. In these challenging times, gaming is a means of social interaction and a distraction from the tedium of lockdown.

Gaming industry revenue outstrips other entertainment sectors — Image source: newzoo[5]

Consumers are spending more time on gaming than ever before. This trend is shifting the business model of companies such as Nintendo from single unit hardware sales to recurring revenue from a subscription service offering online play, cloud backup, a smartphone app and special offers.

Time will tell whether there will be a dip in gaming activity once lockdown ends and the hospitality sector opens its doors again. It may be that consumers will take their mobile gaming into the bars and seamlessly continue to play, but the industry must deliver high quality and engaging games across a plethora of platforms. Bandwidth and mobile internet speeds are a crucial factor.

Consumer pantry shopping trends

It was to be expected that online shopping for food and household items would increase during the pandemic. The scale of growth and sustainability has seen a successful upturn in sales for relevant brands and retailers.

In 2020, 42% of US adults shopped for groceries online at least once in a 30 day period compared to 29% during the same period the previous year[6].

Initially when COVID-19 hit the world, shopping trends covered store cupboard basics along with some stockpiling of things like toilet paper, hand sanitiser, pasta and home baking products. Over time, as people realised that the essentials were not going to run out, panic buying decreased and another change occurred, mainly in the types of food ordered.

Rather than buying staple basics, snacking or comfort food, shoppers are beginning to seek healthier options. Having said that, alcohol consumption during repeated lockdowns remains high.

Across 10 core markets — US, Australia, Brazil, China, France, Germany, Italy, Japan, Spain and the UK — alcohol eCommerce sales increased by 42% during 2020 to $24 billion[7]. This doesn’t necessarily mean that total alcohol sales increased by this amount, but a proportion of the total sales are now occurring online rather than in-store.

Habits formed quickly are hard to break and all indications show that 2021 consumer pantry shopping trends are here to stay.

Fashion and beauty must shape new paths

The unforeseen and drastic worldwide effects of the pandemic on commerce have seen brands across all market sectors having to learn quickly how to respond and adapt to an unprecedented situation.

Some have been more successful than others depending on the suitability of their products and their understanding of the importance to align their online content with the expectations and needs of the consumer, right down to changes in how order fulfilment takes place.

Two areas of the market that have suffered during the COVID-19 crisis are fashion and make-up. These sectors especially must work hard to adapt in the absence of physical stores.

With many people confined to home working, does it really matter if you sit at the computer wearing pink fluffy slippers rather than shoes?

What of the marketing executive in a crisp white business shirt for an online zoom video call — is he wearing smart chinos below the level of the camera, or a pair of shorts?

When buying clothes online there is always a risk that the real garment is different to the photo or the fit is not quite right. This leads to the inconvenience of returning the item for a refund and it is this level of uncertainty, coupled with a lack of need to dress up if there is nowhere to go, that has had such a negative effect on the fashion and beauty industries.

During repeated lockdowns in 2020, a report found that over half of garment suppliers in Bangladesh had seen the majority of their orders cancelled[8].

This snapshot is indicative of the scale and scope of downturn in clothing sales, both online and offline. Even if there are existing stocks in the warehouses, seasonal styles change year-on-year and new clothes have to be designed, manufactured, shipped and paid for. Then, more importantly, they have to be sold.

It is definitely the case that brands in these sectors have to remain agile and adapt their business models to suit changes in the marketplace. Some companies have repurposed by making fashion masks, for example, and some governments have provided funding assistance to invest in more efficient technology or encourage innovations and the leveraging of local design talent.

It remains to be seen what 2021 will bring to these troubled sectors.

In conclusion

The reported changes in consumer eCommerce shopping habits look to be permanent across many market sectors for the foreseeable future. The likely direction set by 2021 consumer trends will force brands to engage positively through enticing and fresh Product eContent, and mobile optimisation remains crucial.

Furthermore, brands should consider their online content in line with consumer attitudes to the growing concerns over environmental issues, sustainability, animal welfare and ethical links to diversity and inclusion. Especially now in lockdown periods where consumers are spending more time thinking about and researching these passions.

Although COVID-19 is providing successful sales for some brands and not so for others, there are steps that can be taken by every business to ensure their online content captivates the attention of the growing consumer audience. Communicating regularly with consumers at every stage of the sales fulfilment process is a critical success factor, whether to notify the shopper of offers, provision of advertised stock or acceptable substitutions. There are huge amounts of data readily available that brands can use to leverage considerable insights.

Helping you prepare for the retail landscape of the future

At eBusiness Institute, it’s our job to keep you up to date with the latest global eCommerce and retail trends, so that we can help our clients thrive in today’s world and stay future-ready.

Please contact us to find out how we can help you maximise your eCommerce and omnichannel performance.

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Sources

[1] [2] https://www.dailymail.co.uk/femail/article-8643847/Online-grocery-shopping-55s-increases-third.html

[3] https://www.npd.com/wps/portal/npd/us/news/thought-leadership/2021/10-consumer-trends-we-re-watching-in-2021/

[4] https://www.statista.com/statistics/1109977/video-game-sales-covid/

[5] https://newzoo.com/insights/articles/newzoo-games-market-numbers-revenues-and-audience-2020-2023/

[6] https://www.npd.com/wps/portal/npd/us/news/thought-leadership/2021/10-consumer-trends-we-re-watching-in-2021/

[7] https://www.forbes.com/sites/chrisfurnari/2020/12/01/online-alcohol-sales-surge-amid-coronavirus-pandemic/?sh=5dc785e4f3a0

[8] https://www.just-style.com/news/timeline-how-coronavirus-is-impacting-the-global-apparel-industry-free-to-read_id138313.aspx