A new decade has begun, and research is revealing the ways in which retail—and consumer behaviors—are set to change in 2020 and beyond.
According data released this week by commerce agency The Integer Group, shoppers’ perception of value has changed significantly over the past 10 years.
Value is traditionally defined as the intersection between price and quality, but today’s consumers are tipping the scales in favor of quality over cost. “This may be because people are becoming more conscious and purposeful with their purchases and the volume at which they purchase,” Integer’s analysts said.
Notably, big-box retailer Walmart has retained its perceived value since 2009, while brands in other categories have wavered. And while e-commerce was said to rule the 2010s, The Integer Group’s research actually showed that everyday shopping channels all saw increases in traffic at the end of the decade, compared to 2009.
Grocery and dollar stores all saw a 6 percent increase in daily visits. Convenience stores and club-based retailers like Costco saw 6 percents and 7 percent lifts, respectively, in weekly traffic.
The trend indicates a penchant for smaller basket sizes for all, and that a variety of retailers should consider shifts in pricing, store layout and merchandising to accommodate the increasingly convenience-focused shopper, analysts said.
Shopping nuances are also being impacted by gender, The Integer Group revealed.
In 2019, men made more overall visits to retailers across channels, and placed a high importance on brand name products.
While women were more likely to prepare lists before embarking on a store run, they also demonstrated a 17 percent higher likelihood of buying more products than they intended.
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Millennial appetites
Age is also an important factor in determining consumers’ spending habits, according to Roth Capital Partners, an investment bank that advises and finances growth companies.
Its eighth annual Millennial Survey, released Wednesday, showed that the generational cohort—which stands to make up nearly three-quarters of the workforce by 2025—is “rapidly redefining consumer patterns.”
Advances in omnichannel retail are being heavily driven by this group, analysts said.
The firm’s data highlighted the ways in which millennials are taking advantage of cross-channel commerce.
More than three-fifths (63 percent) of millennial shoppers who purchase products online actually prefer to make returns in store, analysts said. That’s probably because more than three quarters (76 percent) admitted to browsing the racks after completing a return, suggesting a desire to stay and shop.
While the group is largely driving the proliferation of specialty direct-to-consumer brands (45 percent of millennials have purchased apparel from brands they discovered on Instagram), they don’t necessarily want those companies to remain digitally native. Nearly half (47 percent) of respondents said they’d be more likely to purchase from a DTC company that maintains an in-store presence.
Millennials are also willing to shell out for brands that espouse parallel values. The majority (53 percent) said they would be willing to pay a premium of 10 percent or more for brands that they deem socially responsible.
Despite the growing trend toward conscious consumption, nearly three-quarters (73 percent) of millennials are Amazon Prime members. One to two-day shipping is still a priority for this group, even as in-store shopping remains strong.
Though millennials support emerging brands, their favorite footwear brands are old standbys. For the second year in a row, Nike, Adidas and Vans topped the list for respondents, while Gucci took the top spot as most popular luxury label.
No matter which brands win with consumers on the whole, the new decade stands to usher in fresh methods for discovery and engagement.
Visual search
Global insights and strategy firm National Research Group (NRG) released a new study Wednesday that highlights consumer excitement for the increased use of visual search.
Using a phone’s camera to shop and share products is a compelling prospect for many consumers, NRG claimed.
Seven out of 10 shoppers said they would be likely to use the technology if it were implemented broadly, with the vast majority of Gen Z and millennials (72 percent) saying they’d be eager to integrate visual search into their everyday shopping patterns.
Currently, more than half (56 percent) of U.S. consumers are aware of, considering or actively using visual search at some point in their retail journeys. The primary factor holding shoppers back is education, analysts said, with 59 percent saying they need to better understand how visual search works, and how it could potentially help them.
The majority of visual search (81 percent) centers around using a smartphone camera to find more information on a product. It can also be used to find links to products and services in photos and videos online (35 percent) and search the internet using an uploaded snap (33 percent).
Of consumers who said they’d be likely to try out the technology, 83 percent said that easy access to relevant products and services and hands-free discovery were the driving forces behind their interest.
When it comes to in-store shopping, nearly two-fifths (39 percent) of surveyed shoppers said they were drawn to the concept of scanning a barcode for product information (like price, availability or location within a store), rather than waiting in line for help from an associate. More than one-quarter (29 percent) of shoppers said that being able to scan an item to see price comparisons or reviews would empower their shopping experience, and make them more attracted to the idea of visual search as a tool.
“The high level of consumer interest in visual search as a discovery vehicle surfaced very strongly as a part of this research, with eagerness to use this tool as a prompt for both online and offline experiences,” Ben Rogers, president of platform and technology clients for National Research Group, said.
“The challenge for marketers will be helping consumers surface what they are looking for effortlessly, immediately, and accurately,” he added. “Leveraging the power of AI to accomplish this will be critical—the hunger for enhanced experiences around discovery, shopping, and sharing is there.”