The future of retail is steadfastly being shaped by digital, as shoppers envision a future where nearly two-thirds (64 per cent) of their shopping will be online in the next 10 years. Brands are closing the gap on marketplaces with online spend doubling through direct-to-consumer (D2C) channels, from 7 per cent in 2022 to 14 per cent in 2023, and brands should look to review their online sales models, with more than half (58 per cent) of global shoppers saying they like to buy from branded marketplaces.
According to Wunderman Thompson Commerce and Technology’s Future Shopper Report 2023, which surveyed over 31,000 consumers globally on their current and future shopping habits, online shopping continues its dominance by accounting for 58 per cent of all spend; although we may be seeing a point of maturity, with a modest 1 per cent increase in overall online spend compared to last year.
Despite the omnipresence of marketplaces such as Amazon, Alibaba, and Mercado Libre, their combined share of 35 per cent in global online purchases remains unchanged from the previous year, however, they still top the list when it comes to where shoppers purchase. In second place we see supermarkets and grocers at 15 per cent, followed by branded websites at 14 per cent. But don’t discount marketplace growth yet! Consumers’ trust in these vast online ecosystems extends well beyond shopping, with 42 per cent open to using dating apps, and 51 per cent comfortable purchasing energy, water and utilities, provided by marketplaces.
And don’t sound the death knell for the high street yet, as 60 per cent of shoppers say they prefer to shop with brands and retailers that have both physical and digital stores, making a strong case for omnichannel strategies.
Working from home (WFH) may be impacting purchase behaviours too, with 66 per cent of global consumers saying that they spend more time researching their purchases due to WFH, and 65 per cent stating they have discovered new brands and retailers due to WFH.
No matter what channel consumers choose, the cost-of-living crisis continues to sway decision-making, with price commanding the loyalty of over half (56 per cent) of global shoppers and 53 per cent willing to switch allegiances between retailers and brands for a better price.
Nevertheless, it isn’t all about price, as 23 per cent of consumers expect their products to be delivered in less than 2 hours. And given that 19 per cent of everything ordered online is ultimately returned, free and easy returns are a key battleground.
The stakes are high for retailers and brands to get it right, as 51 per cent of consumers are prepared to abandon those that fail to meet their expectations for a seamless omnichannel experience.
Hugh Fletcher, Global Head of Consultancy and Innovation at Wunderman Thompson Commerce and Technology, said:
“After years of Covid-related uncertainty, we seem to be seeing the first signs of more settled and predictable consumer behaviour. But settled does not mean simple. And in today’s fragmented omni-channel retail landscape, a seamless shopping experience across every channel is not merely an advantage, but essential for brands and retailers.
“Whether you’re a brand, marketplace, social media platform, search engine or physical retailer, the winning formula for success can be achieved through balancing the right price, exceptional service, and a relevant experience across all channels and devices that not only grows but retains customers.
“The question that all brands and retailers must ask themselves is how prepared are they for the consumer of the future? The clues to their future demands are all held within the data, but are businesses making the right investments now to ensure that they can provide the right experiences across the channels that consumers will come to expect?”
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