How has the retail market changed since COVID began? You tell us. We drafted this introduction in July 2020:
“Discretionary spending has fallen—the result of mass unemployment, wage decreases, the realities of living under shelter-in-place orders, and general uncertainty about the future. Money right now is precious. And the “careful” consumer is getting pickier with where they shop. They’re more discerning than ever before. The reason? Supply. While consumers have a pessimistic and uncertain view of the economic outlook, there are more businesses than ever before offering relatively similar products at relatively similar prices. And by now, many have shifted to digital-first marketing, buying up rented ad space and messaging online shoppers in bulk.”
In the 16 months or so since we first looked at the above draft, a lot has evolved. Think: consumer expectations, marketing budgets, and shopping preferences, to name a few. C’mon, even the virus has evolved (Delta Variant, anyone)? But we think it’s just as interesting—and educational—to look at what hasn’t changed all that much. What consumer predilections have stood the test of time? 16 months, four vaccine brands, and an American presidential election later, what trend has stood strong?
Shopping locally. And it’s not going away anytime soon.
Small Business is #Trending
At Iterable, we do our best to keep our customers—brands and businesses creating their own customer experiences—informed. In the lead-up to the lucrative holiday shopping season, we take this mission very seriously.
This year, we surveyed 1,500 consumers across the U.S. and UK to find out how they planned to go about holiday shopping this season. We found that “consumers are ditching the large-scale shopping centers in favor of browsing at local shops, spending their cash at the village boutique and spreading the word about independent brands.”
Small businesses are seeing the benefits of big consumer dollars spent this holiday shopping season. But, why? Let’s dig in.
Mission-Driven Holiday Shopping
Consumers are likely gravitating towards local markets because of a new trend taking over consumer psychology: values. In an assessment of consumer psychology, we found that 87% of consumers said they’re more receptive to a brand’s messages if they know the company’s beliefs and values.
As to why this resonates so well in consumer psychology, respondents said knowing a brand’s beliefs and values:
- Makes them feel more trust toward the brand (62%)
- Helps them better know the brand’s authentic identity (44%)
- Builds belief in the brand’s purpose (34%)
Verishop, an online shopping platform, for example, helps people discover independent brands through advanced technology tools such as Livestream Shopping, Shop Party, a shoppable content feed, and an amazing creator community. Since launching in 2019, Verishop works with a variety of mission-driven brands with ethical and environmentally-friendly practices.The Responsible Shop allows shoppers to filter products via “Shop By Cause,” which includes clean beauty, conscious, cruelty-free, fair trade, organic, philanthropic, responsible, sustainable, upcycled, and vegan products.
“Consumers are becoming much more thoughtful about their purchasing power and are really showing an interest in brands that are responsible and ethically driven. There are more and more brands now that are standing for sustainability and being responsible with their production and manufacturing. It is very exciting to help our customers discover these brands and in turn help these brands increase their business. I’m very confident that we will continue to see the desire to shop responsibly grow!”
-Holly McGill, Associate Director, Partnerships at Verishop
With the COP26 climate summit in full swing, the market is ready for companies to show their commitment to ethics and sustainability. Our advice? Embrace the “local” mindset. Maintain messaging that is community-driven when you market to online consumers as they go global. But climate and emotional connection aren’t the only items on consumer wish lists, on-time delivery is as well.
Supply Chain? NP for the SMB
The modern supply chain was a thing of wonder, delivering material from around the world to companies and customers, seemingly in mere days or even hours.
Until it didn’t. Specifically, this year.
As consumers, we’ve all experienced some recent issues relating to the supply chain—either the lack of available product, higher costs, or both. As shortages of supplies and labor continue to plague businesses and retailers across the country, many small- and medium-sized businesses (SMBs) are pushing an age-old message: come shop with us. SMBs this year seem to be promoting themselves not as one option among many larger ones, but as perhaps the only option as supply chain issues worsen.
Etsy CEO, Josh Silverman, wrote in a blog post earlier this week that his company also sees opportunity in supply chain issues, since many of the sellers on its marketplaces “are businesses of one and don’t rely on just-in-time supply chains.”
It will take time for supply and demand to settle back into more predictable patterns. But that doesn’t mean businesses should wait to take action. We are in the business of relationship building, after-all. And the two most important elements of a successful relationship? Communication and trust.
Brands should be proactive with setting expectations with consumers now, not later. Big, or small, communication matters. If you let customers know what to expect with shipping, stock, and supply now, you’ll set customers up for success, and build the foundation for a positive customer experience.
Creating a Better Holiday Shopping Customer Experience
If Facebook were a country, it would be the world’s most populous nation. 69 of the world’s top 100 global entities are corporations. Walmart has 2.3 million employees in 27 countries. That’s more than any state’s armed forces or any healthcare provider. With these massive corporations, local touchpoints and intimacy have been rapidly disappearing. But for every trend, there is a counter trend. And so with this rise in apathy and generic marketing swings back localization. Consumers have become protective of their community, their data, and the signifiers of what is local, especially when it comes to discretionary spending.
When given a choice between a local store and a major chain, you know what you’re going to experience with each. With the chain, you’ll have the convenience of knowing you will find your product at an affordable cost. But what is lacking in these engagements is personality. And it’s that personal connection, where a memory is attributed to a brand, that matters to today’s consumer!
Customer experience has now become the key brand differentiator, edging out both price and product in building customer loyalty. And COVID-19 has only intensified the need for agile and nuanced marketing. The pandemic has shown that brands need to replace sales, click-throughs, and new customer acquisition with customer trust, retention, and loyalty.
Think Small to Sell Big
The relationship between a brand and a customer is often a fragile one. Make one mistake, upset the customer, and they’ll remember that bad interaction. Some will hold onto that grudge with longevity, never again to return to that brand. Still others will use their social prowess to share about their experience with others.
But if you treat your customers well while they’re holiday shopping, they will trust your brand, feel encouraged to return, and, in many cases, share their praise with friends and family.
To learn how Iterable can help you scale and automate your marketing efforts to create a personalized experience, schedule a demo.