Targets audience company GlobalWebIndex (GWI) released its flagship Commerce report (N=179k), which explores how economic confidence and spending habits are changing, and consumers’ digital preferences in ecommerce.
The report provides new insights on the commerce industry as a result of the pandemic ahead of the Golden Quarter.
• Economic confidence tanks globally, with 74% of UK expecting the economy to get worse in the next 6 months, compared to just 7% in China
• 54% of UK shoppers rank listening to customer feedback as their top request from brands, followed by social responsibility at 51%
• UK consumers are more willing to subscribe to TV (46%) and music (30%) than they are to groceries (29%), with 35% of millennials in the UK saying they’re interested in a coffee subscription
• Over half (52%) of the UK have used the Amazon app in the last month, making it the most used app
The latest research which comes from surveying 179,219 internet users across 46 markets, reveals economic confidence is tanking globally. This is a sentiment felt most strongly in Europe (7 in 10). Concern in other markets fluctuates – 74% of internet users in the UK expect their economy to get worse in the next 6 months, compared to just 7% in China.
As a result, consumers in the U.S./UK specifically are adopting practices to save money. 3 in 10 have switched to buying a product from a different brand because they offer lower prices, while others are reevaluating their demands of ecommerce. Among consumers who say that next-day delivery would increase their likelihood of buying a product, during COVID-19, 30% say they’ve allowed for longer delivery time if it saves them money. In terms of top priorities, 54% of UK internet shoppers rank listening to customer feedback as their top request from brands, followed by social responsibility at 51% and eco-friendliness at 45%.
UK consumers are also more likely to say they’re interested in subscribing to TV streaming services such as Disney and Netflix (46%) and music such as Spotify (30%) than they are for food services (29%).
Chase Buckle, Trends Manager at GlobalWebIndex said: “It shouldn’t come as a surprise that UK internet users are more interested in subscribing to entertainment than food and beverages. High-frequency categories like groceries are well-suited to subscription models, especially as online grocery has taken off during the pandemic. Many are interested in meal subscriptions too, where the wide choice of recipes and ingredients on offer have proved popular as cooking has received a new lease of life in many households during lockdown. But these are still nice-to-have services rather than must-have.
The likes of Netflix and Spotify have taken an indispensable role in modern entertainment preferences for some time. Their enormous libraries and buzzworthy content are a part of how we consume entertainment.”
The subscription economy
Almost a third (31%) of U.S/UK consumers say that the main reason for purchasing a subscription is because it’s cheaper/better value for money.
Close to half of consumers in the U.S./UK (47%) say they’d be interested in buying a subscription to an online TV streaming service and 31% would be interested in buying a food/grocery subscription in the next 3-6 months.
However, that’s not to say that other subscription categories don’t have appeal. For example, 31% of millennials say they’re interested in subscribing to a coffee subscription and 22% of Gen Z have their eyes on a beauty/cosmetics subscription in the near future. There’s still potential for other categories, they’re just a much lower priority on consumers’ subscription lists.
Chase Buckle, Trends Manager at GlobalWebIndex said: “To get consumers on board, they really need to be convinced about the continuous value they’re getting – especially as having different subscriptions takes a toll on consumers’ purse strings.
There’s a reason why interest in subscription services is clustered around a few specific categories: the subscription model isn’t suitable for every product. Subscription either allows people to receive high-frequency products with high quality and reasonable price points (e.g. personal grooming), or it allows them to access a wider variety of diverse products or services (e.g. entertainment).
Our latest global data shows two-thirds of consumers would rather own a product/service than to have to pay to access it. This tells us people don’t want a subscription for absolutely everything, and as the economic toll of COVID-19 continues, consumers will certainly be more selective about what they sign up for.”
Meaning of “online” is evolving
Almost half (47%) of global internet users have used either voice or image search in the last month on mobile. As we’ve seen, mobile is fast emerging as the preferred purchase method for consumers when shopping online. However, the way consumers search for products and services is changing.
Gen Z’s preferred methods of brand discovery lean more heavily on social media. Nearly a third of Gen Z discover brands via ads on this medium, compared to the average of just 27%. That said, social media is not just a Gen Z obsession; ads seen via this platform feature in the top 7 ways in which both millennials and Gen X also typically discover new brands and products.
The most important developments are voice search (such as Siri) and image search (such as Google Lens). Globally, they’re essentially as popular as one another. In the last month, 34% of internet users have used voice search (increasing from 25% in 2017) and 33% have used an image recognition tool on their mobiles.
Chase Buckle, Trends Manager at GlobalWebIndex said: “Unlike traditional search engines, or the more contemporary social network search, these new techniques yield much narrower (sometimes even singular) sets of results. What this ultimately means is that the stakes have gotten so much higher. If businesses are not optimized for these new formats, they won’t show up, and stand to lose out.
Internet users in the U.S. and UK are most likely to want to try out AR uses inside their homes such as furniture layout (31%) or virtually repainting the walls (31%). Try on applications, such as glasses (26%), clothing (26%), or makeup (17%) are less popular. Only 19% of Gen Z are not interested in using AR, compared to 56% of baby boomers.”
Chase continues, “While over a third are not at all interested in using the technology, this is a sentiment felt most by older generations. Moreover, for all uses of AR, U.S. internet users are slightly more interested, suggesting the technology has been adopted more so there than in the UK currently. The trick to its continued growth and success will be for marketers to help consumers understand the technology better and for developers to make it easier to use.”
Which industries are best set for ecommerce around the world?
Online grocery shopping is the vertical that’s seen the most explosive growth. The U.S and Canada have seen the greatest increase in ecommerce demand, as major platforms, notably Amazon, look to secure their cut of this demand. Interestingly, in the U.S, grocery subscriptions (32%) are slightly more popular than music streaming (28%).
Between Q3 2019 and Q2 2020, the percentage of internet users who have purchased grocery items online in Europe has steadily increased from 20% to 24%; a small, but statistically significant increase. In the U.S. and Canada this is even greater, growing from 21% to 31%.
Meanwhile, the Amazon boom continues. Over half (52%) of UK internet users have used the Amazon app in the last month, making it the most used app out of the 26 tracked by GWI.
With 44% of global consumers very or extremely concerned about a second wave and the same percentage expecting the outbreak to last longer than a year, Amazon is positioning itself for the near future through eye-watering aggressive investment in COVID-19 measures – no other company has the capital and investment available to do this on such a huge scale.
Chase Buckle, Trends Manager at GlobalWebIndex said: “It has been over a year since Amazon eclipsed Walmart as the biggest retailer in the world. It should come as no surprise then that of the 46 markets tracked by GlobalWebIndex, it’s the top commerce app used in 21 of these markets. Having said this, there are clear market differences – especially when looking at China, which has such a unique ecommerce landscape. The top apps there are Alipay (47%), Taobao (44%), and Tmall (36%). Similarly in Latin America, MercadoLibre is the clear market leader at 45%, followed by Amazon at 30%.”
Source: Global Web Index