‘Natural’ seasonal events drive change in online volumes. Change in online volumes correlates with the height of basket value
It is the end of Quarter 1 of 2022, and what a rocky first three months it has been. Time to look at the (new) quarterly e-commerce development and inflow. In this blog we talk about the online shopper share in the Netherlands, Germany, Norway and the UK. But what are the differences between the four countries that we measure? In which country are the highest basket values? Even with an already high inflation level and a conflict on our continent, how much are consumers worrying about their finances and health?
Curious yet? Get all the answers here in our new blog.
Online volumes affected by lower pandemic push
We enter the second month of spring. We know that after the slow months of January and February, the online volumes are (supposed) to go up again. The online volumes we see in the chart are driven by the penetration of online shoppers in the population, in combination with the purchase frequency of the online shoppers.
The numbers are positive for the UK (5.7) and Germany (5.2) as their numbers are slowly climbing. Norwegians remain at 3 online purchases in the past month. The Dutch online shoppers are the only consumers making fewer online purchases in the past month.
Two years of tracking tells us that is a ‘normal’ occurrence. The previous two years have the same patterns. The overall online volumes are lower the months after Peak Season. This year’s number are slightly lower due to a lower pandemic push (as we see in the lockdown periods of 2020 and 2021) on consumers to shop online as opposed to in brick-and-mortar stores.
The penetration of the population sees a shift in numbers, too (measured as the share of population that has made at least one online purchase during the past 2 weeks). By March 2022 the penetration of online shoppers decreases by 4 to 5 percent points in the Netherlands (73% in March 2022 vs 78% in December 2021), Germany (77% in March 2022 vs 81% in December 2021) and Norway (64% in March 2022 vs 69% in December 2021). The UK has a less steep decline and has a drop in percentage with 2 percent points (84% March 2022 vs 86% December 2021).
In addition to the decrease we see in penetration, the online purchase frequency among online shoppers is lower, too. This development follows the same pattern as we saw during Q1 of last year.
*We first started analysing basket value in March 2021*
Basket Values are relatively stable over time
At the end of Q1, the biggest spenders of our four countries are the Norwegians (spending 81 EUR ~ 776 NOK), next in line are the Dutch (65 EUR), then the German shoppers (59 EUR) and fourth come the British (56 EUR ~ 47 GBP).
Increase in basket value happens when purchase volumes decrease. It also goes the other way around: increasing purchase volumes lead to lower basket value. Online shoppers ‘balance’ their economy. When a lot of purchases are needed, then the baskets have lower values. And baskets will have hefty price tags when not many purchases are on the agenda. The graph shows these fluctuations unmistakably. Peak Season-month December has a high online volume (many online holiday purchases), but the basket value is low. Consumers buy many things, but spend less.
Financial worries peak due to extreme and uncertain events in the world
Consumers worry about finances when unexpected and unpredictable events happen in the world. These external factors put pressure on people minds and perhaps wallets. The start of the pandemic and the start of the Ukraine war with its financial repercussions, cause for spikes in our graph. These significant increases in shares of worry about financial situations are clearly visible. Especially with the stable worry levels between these two events. In general, consumer worries about personal finances are stable.
Lower health worries are good and ‘bad’
Many countries lift their last restrictions. The fight against the virus is towards the end and health worries are lower than the worry levels one year ago (in March 2021). From two years of tracking health worries, we know that health worries are correlated to online purchase volumes (good for merchants), when health worry increases (worries are bad) – so does online purchase volumes, and vice versa.
Peaks in health worries are visible in the beginning of 2020 with the start of the pandemic and with new variants of the virus spreading across the countries. The volumes were high at the time. Now the pandemic itself and the impact on online purchase volumes has decreased over time. The omicron boom and health worry decrease significantly since December 2021.
It remains unclear if the health worry is ‘back to normal’ levels, but levels are back to the summer of 2020 and summer of 2021 levels when they are at its lowest. The low health worry levels and end of the virus and restrictions most likely result in lower volumes (‘bad’) this spring shopping season, comparing to what we saw one year ago.
It’s the start of a new month. That means a new Outlook is on its way. What are consumers planning on buying in April? What are the rising stars in product categories? Who make the most purchases? And what will be the effect of lifted restriction when we look at tickets and transportation? Bring on spring, come one quarter two. We will be back soon, with a new blog for you!