Consumers Have Changed
Adapting to change has always been my normal. I don’t always like it, but unforeseen challenges offer the opportunity to once again, overcome. Digital change is happening at breakneck speed. I know that soon ‘digital marketing’ will become a historical buzz word I once lived by and the only problem solving for me will be which car to take to the beach. Before I hang up my career hat though, I press on with keen observation to what is currently affecting consumers and their spending habits.
(After all, consumer habits affect our clients and my ability to go to the beach).
Due to the recent pandemic, consumer spending and shopping habits have both exploded and diminished. Like the automobile taking over the horse and buggy everything is now faster and more convenient. Without digital conveniences made available to consumers, many businesses are getting left behind. It’s vital to understand what’s happening today and adapt.
Online Shopping Has Overtaken In-Person Sales
We can all see that malls, the previous beacon of American shopping, are dying a slow but obvious death. An amazing 25% of America’s remaining malls are expected to close by 2025, and that’s on top of the shopping centers that have already faded away. Some malls are attempting to repurpose by renting space to service-oriented business rather than stocking shelves with products. Today we see realtors, churches, gyms, and dance studios filling up space.
My vision is to take it one step further and re-purpose malls into self-contained low income housing communities. Good idea, huh.
In the meantime, e-commerce has boomed, and that growth isn’t dropping off. E-commerce grew another 14.2% in 2021 even as stores reopened and in-person shopping became more common. The habit of mass consumer buying online was birthed during Covid and the majority of those consumers will probably never go back to in-person shopping. We all love the incredible time-saving convenience of having car parts, food, and Christmas presents delivered right to our door.
Keep your horse and buggy for Sunday drives but use the Maserati to drive your income. If your store does not have an e-commerce option, or your online website is slow, outdated, and clunky, now is the time to upgrade. In the near future very few consumer products will be purchased in-person. Even cars are being bought online and delivered to homes without even a test drive. Businesses will continue to get swallowed up without a professional online presence.
Brand Loyalty Habits
If we know anything about loyalty, it’s that it’s based on habit. People get comfortable with a specific brand or a specific store, and they simply get in the habit of always going there.
‘We-always-go-to-Costco’ habit. But COVID-19 interrupted everyone’s habits and we now have adopted new ones. That means that for the first time, consumers had the ability to quickly look around online and comparison shop. In fact, 40% of consumers reported switching brands or products during the pandemic.
This was due partly to the disappearing act of our favorite products at our favorite stores. Employee shortages, over-worked delivery drivers, under-staffing, forced mask wearing, fear of contracting Covid, and a bunch of stuff stuck on barges out in the ocean, pushed consumers online. That, combined with the excitement of trying a new service like home delivery or curbside pickup, created an explosion of online buying.
How AI and VR Will Impact the Shopping Experience
Ever since Mark Zuckerberg announced his intention to create the virtual Metaverse (have you read Ready Player One yet?), there have been questions about how virtual reality (VR) and artificial intelligence (AI) will impact shopping as we move forward.
AI already plays a big role in the average consumer’s shopping experience, although they might not know it. Predictive technology feeds buyers’ specific ads based on their interests, past purchases, where they live, and more. If you click on an ad, you’re sure to see five more for similar products in the near future. Even the person scrolling next to you on the plane can impact your own feed.
In VR, users put on a pair of goggles to immerse themselves in a fictional world where they play, interact, and adventure. Because VR creates a 360-degree world, there’s a ton of opportunity for interactive advertising where consumers can try a product out in 3D, and be seamlessly moved into a purchase with actual money.
While we can’t yet predict the expanse of how VR and consumer shopping will intertwine, there is no doubt that among the virtual fun, games, and adventure, there will also be plenty of opportunities for consumers to spend money. Or Bitcoin.
Get Ready for the Digital Shopping Revolution
Have you adapted to the new normal that’s been created in consumer behavior? The significant growth in e-commerce isn’t going away as more and more consumers learn to trust online shopping and enjoy the convenience. AI and VR are also going to continue to develop, making shopping fast, fun, and more convenient.
If you’re experiencing a drop in business due to less traffic, we always offer free evaluation with no strings attached. It is our pleasure to see businesses adapt and thrive regardless of our partnership with them, so don’t hesitate to contact us today.
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