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Managing changing shopper behaviour in the age of channel shifting

by GBAF mag

Patrick van der Zee, Senior Vice President International Retail, IRI

The pandemic has changed the way in people shop and what channels they use. Many of these behaviours will stay with us, while others evolve. But it is unlikely we will see a return to the way we have done things before.

What we have seen is the move to online shopping accelerate and ecommerce reach levels unseen pre-COVID. With shoppers forced into lockdowns and subject to restrictions, online has benefitted. Those who did decide to go in-store were faced with a very different experience, social distancing, hygiene measures and masks, and early on lengthy queues outside stores. Online grocery shopping has offered the benefits of convenience, timesavings, and health and safety in challenging times.

Share certainly shifted more to e-commerce in the early stages of the crisis but then remained at an elevated level. In Italy for example, e-commerce spending was low compared to other markets at just 1% share, but is predicted to reach 4% by the end of 2021, maintaining 95% growth year on year.

It’s interesting that the crisis has also introduced older shoppers to online. According to IRI’s Shopper Survey in Germany, 7% of baby boomers ordered food online during the crisis and 5% intend to continue. Retailers will need to adapt their e-commerce capabilities for this group of shoppers in order to meet their needs.

Supermarkets also need to expand online delivery services if they are to meet growing demand, including investment in click and collect, a more cost-effective option than home delivery. Many of the major supermarkets have turned to third party delivery services as a way of expanding delivery capacity as a time when it’s most needed.

Proximity is also a deciding factor in shopping missions today. Location has always been important in store choice for shoppers, but during the pandemic, particularly in the lockdown phase, it was critical, even a lifeline for some. The convenience channel and local stores have seen a huge increase in footfall as a result, and with many people working from home or unable to work.

But convenience is not always benefitting from changing shopper behaviour. With fewer people travelling to and from work or restricted in terms of travel, those convenience stores in travel hubs have struggled, while on-the-go food and drink sales are down. Convenience retailers will need to give customers what they need when the need it; providing all the benefits of local shopping, with a range of products at the right price.

As online grocery shopping becomes more entrenched in consumer habits, convenience stores have a unique opportunity to drive growth and competitive edge by offering e-commerce capabilities that consumers want.

While the pandemic has changed the way we live and shop, many of these behaviours are still evolving, while others are here to stay. Convenience and speed have taken over from brand and retailer preference, while getting a much-prized online delivery slot is the new normal.