Today's eCommerce and retail landscape look very different than they did one year ago. The accelerated trend of online shopping, the disruption surrounding Brexit in the middle of a pandemic and the steep rise of fraud have shifted consumer behaviour and allegiances in more ways than one.
We decided to conduct a consumer survey of over 2,000 British shoppers to better understand consumer habits, key influencing drivers for purchasing decisions, attitudes towards global eCommerce, the state of loyalty and the perceived risk of fraud.
Our findings paint a mixed picture of the British consumer with splits across regions and age groups. However, a common ground is that British consumers still favour European retailers, despite Brexit and the pandemic. With an exclusive data set, our New World, One Market report captures the zeitgeist through unique insights and exceptional detail about the modern consumer profile. Here are some high-level highlights of the report:
European retailers win the hearts of British consumers, but only in certain UK regions
55% are likely to buy from Western Europe and 45% from Northern Europe. In addition, supporting local retail only mattered to 14% of shoppers, with just 8% preferring to buy from the UK. Only 3% of shoppers said politics was a consideration when choosing where to buy an item, depicting a modern consumer unaffected by geographic boundaries or shifts in political dynamics.
Respondents from Greater London were consistently more likely to buy from countries other than the UK. The majority of Londoners said they were likely to buy from Western Europe if given the option (63%), and more than half (56%) said they would buy from North America. Northern Irish respondents were most likely to buy from Northern Europe (53%), and those in the South East were most likely to buy from Eastern Europe (35%).
On the other side of the spectrum, people in the South West were the least likely to buy from countries other than the UK. Half of the respondents said they were unlikely to buy from South America, while 48% declined to buy from Eastern Europe; almost a third wouldn't buy from North America or Northern Europe. Nearly a quarter (24%) wouldn't buy from Western Europe. This finding highlights the need for European retailers to truly understand the geographic dynamics that impact British consumers and the need to tailor their offering to create value for their shoppers. Equally, it represents new opportunities for British retailers to reach more audiences across the UK and serve their evolving needs.
Ethics, sustainability and shopping local matter for one in ten consumers
Over the past years, there has been a media buzz around ethical shopping and sustainability and their relevance to today's consumers. Our research showed that this trend remains relevant, but only for one in ten consumers. More specifically, for non-grocery products with a value less than £50, the environmental impact and shopping from ethical brands only mattered to 10% of consumers. From a demographic perspective, the Silent Generation showed the strongest preference for environmental impact (13%). In comparison, only 11% of Gen Z and Millennials stated that ethical brands are key to making a purchasing decision.
Preferences slightly change when it comes to non-grocery products with a value of more than £50. 19% of the Silent Generation and 14% of Gen Z said that shopping from ethical brands matters when making a shopping decision; by contrast, it matters to only 7% to Baby Boomers, 9% of Gen X and 11% of Millennials. Across generations, environmental impact and ethical brands only mattered for 10% and 11% of consumers respectively.
Buying local matters to 11% of consumers, with the Silent Generation leading the pack (25%), followed by Baby Boomers (15%), Gen X (13%), Millennials (10%) and Gen Z (9%). On the whole, our research showed that the top considerations for purchasing decisions was price (53%), perceived quality standards (46%), product reviews and speed of delivery (31% each), shopping from a known and trusted brand (26%) and ease of return (25%).
It's more important than ever for brands and retailers to continue to focus on enabling their customers to shop when they want, how they want, and where they want, all the while through an enjoyable and frictionless experience.
Free delivery could encourage increased consumer spending, while consumer trust drops and brand loyalty diminishes by age group
Our research showed that more than half (55%) of consumers are willing to pay more for a product if delivery is free. The average Gen Z consumer said they would pay up to £3.98 for delivery for an item up to £50 in value, versus Baby Boomers who are only willing to spend up to £1.74. The latter group was most likely to believe that delivery should always be free (48%).
However, attitudes vary by demographic group. The majority of Gen Z (76%) and Millennials (62%) are willing to spend more, compared to the majority of Gen X (47%), Baby Boomers (62%) and the Silent Generation (56%), who are not.
When it comes to consumer trust, product reviews are generally considered to make or break the path to purchase. Our research showed that one in five people believe that more than half of online reviews are fake. However, a third (30%) listed product reviews as an important consideration when choosing where to buy.
Reviews could still be social proof for brands that consumers are not acquainted with; however, our research clearly proves that consumer trust in online reviews has dropped.
At the same time, more than a quarter (26%) said product reviews would encourage them to switch to another brand. But friends (75%) and relatives (71%) were the most important sources of advice for product recommendations, with social media influencing more than half (57%) of Gen Z.
Looking into brand loyalty, our consumer research underlines that allegiances seem to decline by age group. 7% of Gen Z and 9% of Millennials claimed not to be loyal to any brands. 17% Gen X, 23% Baby Boomers and 31% Silent Generation gave the same answer.
Shoppers recognise a greater risk of fraud following the pandemic
It's no secret that fraud has seen a staggering uplift since the onset of the pandemic. Research from TransUnion showed that since Covid-19 started, fraudster threats against businesses have increased by 46%.
Our research found that 46% of shoppers feel that there is a greater risk of fraud now than before the pandemic. 50% believed there to be the same risk now as before - rising to 60% for Baby Boomers.
In response to this perceived risk of fraud, consumers said they would only shop from trusted businesses (47%). A third (34%) said they change their passwords more frequently, while a fifth (22%) have been put off from buying from certain countries and 18% from some brands. 15% of people haven't changed their buying behaviour at all.
The risk of fraud is inherent when shopping online for retail brands. Simultaneously, in-store payments also carry their risks for retailers. Adopting a unified commerce strategy will empower brands to not only optimise their overall payments' performance, but also combat fraud more efficiently by providing to a single view of the customer.
Are you ready to think different?
Download your copy of the 'New World, One Market' chapters two and three today and learn about the key factors influencing purchasing decisions, attitudes to global eCommerce, brand loyalty and the risk of fraud.
Get in touch to discuss how you can adapt your payment strategy to 'the new normal' and design an intuitive payment journey, both online and in-store.