With the rise of the global pandemic also comes a time of uncertainty for many people. Uncertainty is undeniably linked to worries. These worries not only preoccupy consumers’ thoughts, but also translate to an impact in their purchasing behavior. For some businesses, these changes mean skyrocketing sales. For others, the negative impact of the corona-outbreak is devastating.
Either way, developing a solid understanding of consumers’ worries is essential for many businesses, especially in uncertain times like these where merchants need to prepare for quick changes in demand. In light of this, we have identified four distinct worry segments that - based on the corona crisis - have accentuated different needs for their e-commerce shopping experience. Besides that, the impact of these segments is different depending on which vertical you as a merchant operate in.
In this blog post, we take a deep dive into the different types of worries that consumers have, and how these impact attitudes and online e-commerce purchases. You will also find out how different worries interplay, how these affect online purchases in different verticals and what the differences are between countries.
Almost a quarter of consumers state that they are worried about their health as well as their current financial situation, and 15% has no worries at all in either dimension. But at the same time, there are segments of consumers that are only worried about their health (13%) or finances (7%). 42% of consumers are in limbo – they’re either very worried about their health/finances, or not worried at all.
Well, you don’t. However, we looked into if the level of worries shifts after the corona outbreak, depending on the purchased products and services. Clearly, there are differences. So use the diagram below to get an indication of how worried your consumers might be right now.
Consumers who are shopping for Food & Groceries and Take away food with home delivery are relatively more worried about the corona outbreak from both a financial as well as personal health perspective compared to those that currently purchase ‘Kitchen appliances’, for whom the general level of worry is low from both perspectives.
As mentioned before we have identified four distinct worry segments that - based on the corona crisis - have accentuated different needs for their e-commerce shopping experience.
1. Consumers who are worried about both health and finances
This group of consumers is an important segment as they represent 23% of online consumers and make up the largest share of e-commerce purchases (28% of all online purchases in the past two weeks). But these consumers have decreased their number of e-commerce purchases the most since the corona outbreak. They have reduced purchases in all categories except in Groceries, Health/Health food products and Take away food with home delivery where they have increased purchases. However, looking ahead, the outlook for this segment is positive as they indicate an increase in their online purchases in the month to come.
They currently spend more time at home and really try avoid meeting other people. And as they are worried about the economic situation both from a personal finance and a societal perspective they are focused on low price and value for money.
The health perspective is also important when purchasing items online, as can be seen by a large share being concerned that they get exposed to virus when they need to pick up a package as well as concerned that packages might get contaminated with virus.
They are comparatively less driven by using websites they have shopped at before, but they have the highest demands on fastest delivery time, flexibility in returns and delivery as well as having flexible payment options. From a sociodemographic perspective, the persona of this segment can be defined as non-academic working families with kids at home. They mainly live in or close to the city centers.
A very anxious and comfort-seeking group of consumers who are driven to online shopping because they want to avoid meeting other people. They also display a need for a different set of products and services as they spend more time at home. Their worry is not only to get contaminated, but also that delivery of ordered products will be delayed or not take place at all.
This consumer segment is overrepresented in terms of number of online purchases in relation to the size of the segment measured as share of all online consumers. This is also the segment that to the largest extent has switched from offline purchases to online purchases. The segment persona is similar to that of the consumers who are worried about both health and finances, in that they are overrepresented among consumers aged 55 years old and above.
As opposed to consumers who are only worried about finances, these consumers indicate they will increase their online shopping in the month to come. They are not worried about their financial situation (yet). Moving forward, this group of consumers is an interesting segment to consider monetizing more.
This group of consumers is loyal - they choose webshops they have purchased at before, and they want those webshops to offer a wide range of products. But they are not price sensitive as can be seen by their low preference for lowest priced webshops.
This is still a relatively small segment – in terms of consumers and purchases – is made up of consumers who are worried about their financial situation both from a personal as well as a broader societal perspective.
The consumers in this segment are very much affected by worries about their financial situation – so much so that they have decreased purchases, both offline and online. At the same time, they have made a strict prioritization to purchase ‘need to have’ items over ‘nice to have’ items. From a sociodemographic perspective this segment is overrepresented among unemployed and students.
For consumers who are only worried about their financial situation, drivers for purchasing online are primarily functional. The fact that they spend more time at home and that stores and restaurants are increasingly closed, make ordering certain items online a more logical option.
As this group is very worried about their financial situation, they seek out the lowest priced webshops. And if this is coincidentally also a webshop they have used before, then that is a great advantage. They are not overly concerned about reliability in deliveries, but they do want the fastest delivery and flexible payment options.
This segment is constituted by having no worries about the corona outbreak both from a personal health as well as a financial perspective – and because of this they have not altered their purchase patterns in any significant way. This is also the segment that has the highest share of consumers stating that they will not change their number of purchases online in the month to come. Consumers who are not worried are most prevalent offline; their share of online purchases is less than the share of consumers represented by the group.
The persona for this consumer group is an older or retired man with a high income. These consumers show consistent behavior and don’t like surprises. They like to feel special since they perceive themselves as being very important.
But just like the other segments, consumers who are not worried have definitely been affected by the lockdown. A characteristic driver for shopping online is therefore the fact that they now spend more time at home and as a result have certain product and service needs. The basic lack of worry among these consumers results in them placing roughly the same demands on webshops as the overall consumer average.
Looking into the countries we analyzed, we see significant differences between Norway on one hand and Germany and The Netherlands on the other. In Norway, only 19% of consumers are worried about health and finances. But in Germany and The Netherlands this share is a quarter of consumers. And on the other end of the spectrum, 21% of Norwegians are not concerned at all.
The sizes of the consumer worries segments are likely to change as the corona crisis develops in the different countries. We will keep monitoring this, but we already see some tendencies based on our latest data indicating an increased polarization across countries. Especially consumers’ shift into not being worried at all or having worries about both health and finances is noticeable here.
Consumers who are worried about both health and finances have decreased their number of purchases since the corona outbreak, but we see them increase online purchases moving forward. This conclusion is based on a larger share of them estimating that they will increase online purchases in the coming month, compared to the share that say they will decrease purchases even further. The same can be said for consumers who are only worried about their health and consumers who are not worried at all.
In contrast, only 20% of consumers who are only worried about finances say they will increase, while 25% say they will decrease e-commerce purchases in the coming month.
When looking at an increase or decrease in online purchases, consumers who are not worried at all are the most unaffected segment, having the largest share of consumers (64%) stating that they will not change their number of e-commerce purchases in the month to come.
We will add in new data and dive deeper into what you as a merchant can do to adapt and serve your consumers better during this fast-changing landscape of attitudes and needs.