Dutch consumers’ projections for September are to shift more purchases from brick-and-mortar stores to online. Consumers are most positive towards increasing purchases in online Fashion. As this is the largest online category, this could significantly impact overall September online purchase volumes.
Our second half of August research – now covering more than 12.600 interviews with Dutch online shoppers – also reveals that Dutch consumers made less online purchases in August, dampening total e-commerce growth during the summer to +15% since the Corona outbreak. However, since consumers’ attitudes related to future e-commerce purchases and worries have been stable throughout July and August, we can conclude that consumers’ attitudes are not the cause of the decrease in e-commerce purchases. Rather, external forces are at play here, among them certainly the summer seasonality effect.
From an e-commerce consumer base perspective, the fluctuations in Dutch online purchase development are primarily driven by the share of Heavy Shoppers in the marketplace, a segment comprising 10% of consumers, who make a massive 38% of all online purchases. Interestingly, as the share of Heavy shoppers has decreased, the total number of e-commerce purchases also has decreased. A secondary driver for Dutch e-commerce growth is the inflow of new consumers who switch from brick-and-mortar stores to online. Fashion and Food, are most successful in attracting new consumers since mid March.
We are currently in an exciting phase of e-commerce development as we come out of the summer season. We will continue monitoring these changes and will bring you the continued ‘autumn-story’ in the next month.
The trend that Dutch consumers claim they want to consume less overall has been consistent for the past three months. But at the same time, Dutch consumers say they want to shift more purchases from brick-and-mortar stores to online channels. And overall Dutch consumers are positive to increase online purchases in the majority of categories during September. Here, Fashion sticks out. Even though Fashion purchases have decreased during the summer, it is the category where Dutch consumers are most positive to increase purchases in September.
Other categories that consumers say they will likely purchase more of in September are Entertainment and Hobby Articles. We also see that Kitchen appliances has increased the most in The Netherlands at +73%, and consumers project to buy almost at the same level in this category during September. Tickets and Travel/Transport, however, are at -42% and -28% respectively to date.
Bear in mind, this graph does not take category size into account. For example, Kitchen appliances only stand for 3% of all online purchases in The Netherlands while Fashion, being the largest category, account for 22% of all online purchases.
Looking at consumers’ purchases in online product categories until September, we see that the share of consumers having made at least one online purchase in several product categories was dramatic. In Food/Health Food, for example, only 12% of consumers were buying Food/Health Food online, and within a couple of weeks this figure measured 27% of consumers.
And Fashion/Cosmetics’ journey is equally impressive, but more gradual. 17% of Dutch consumers were regular online shoppers in Fashion/Cosmetics’ prior to corona, and by the first half of May one third of Dutch consumers were buying Fashion/cosmetics online. However, Travel/Tickets has suffered hard, starting out with 8% of online shoppers. This dropped overnight to 3%. It has been a long road to recovery since then, at 7% by the second half of August.
If we leave the product category perspective, and zoom out to Dutch e-commerce as a whole, we again see that the overall share of consumers having made at least one online purchase shows a steep initial inflow – from 64% of consumers pre corona to 74% of consumers by the first half of May. This inflow of new consumers has stayed stable at aroung 70% since May, and is - both from a category as well as an overall view – a driving force behind Dutch e-commerce growth.
The other force at play is existing online shoppers buying more. Pre-corona, the share of Dutch consumers that made 5 or more online purchases bi-weekly was 7%. During the initial development phase, the share of Heavy Shoppers more than doubled to 17% of consumers at peak purchases during the first half of May.
While the share of consumers making an online purchase has stayed stable, we do see a strong correlation between the share of Heavy Shoppers and the total e-commerce purchase growth, i.e. overall e-commerce purchase growth is driven primarily by Heavy Shoppers. This is also evident as Heavy Shoppers stand for a disproportionately large share of purchases; at the second half of August 10% of Dutch consumers were Heavy Shoppers, but they stand for 38% of all online purchases in The Netherlands.
As mentioned above, Dutch e-commerce has grown over the past months. However, our analytics of the overall e-commerce purchase development, along with the changes in consumer motivations for purchasing online, reveal three distinct development phases – so far.
In the first development phase, directly following the corona outbreak, we see a boom in e-commerce purchases that peaks during the first half of May when Dutch consumers make +51% more online purchases compared to their purchase behavior in mid March. The key drivers for this growth are being locked-down at home in combination with reduced access to restaurants and stores. Barriers to purchase online also exist, primarily the fear of picking up the virus from packages, but these barriers are not strong enough to dampen the e-commerce purchase boom.
In the second development phase, during June and July, the e-commerce purchase growth dampened to a growth of +30-40%. During this period, the key drivers for purchasing online also changed. The convenience and good prices online grew as a key motivators, at the same time as the lock-down driver decreased in importance. In addition, a not to be underestimated barrier to purchasing online also emerged during this period, and that was consumers wanting to support local physical stores.
From the second half of July and through August, the third development phase, e-commerce purchases dampened even more to where growth in The Netherlands per the second half of August is at +15% compared to before the outbreak. What forces are at play here? We will know more when we have gathered data from the first half of September, so stay tuned.
In line with for example Germany, Dutch consumers are generally more worried about their health than their personal finances. In mid-March, 53% of Dutch consumers expressed being worried about their health, compared to 36% expressing a worry about their personal finances. After the first half of April, consumers are less worried and this remains stable to the first half of July.
But from the second half of July and during August, Dutch consumers' worries about health increase significantly among Dutch consumers. What to expect as a result? Is there a time lag that will result in changed consumer behavior during September? We are monitoring this and will analyze it, so keep posted.
Note that, during this same period the worries about finances are stable. The result is that the gap between worries about health and worries about finances is now at almost the same magnitude as in mid March
Dutch consumers’ satisfaction with merchants underwent quite dramatic changes during the initial phase of the pandemic. Overall, the conclusion is that the e-commerce eco-system managed the increase in volume, but delivery time suffered in the early phase – and to some extent also logistics (by keeping products in stock).
As customers' satisfaction with delivery time improves during the peak purchases in May and still recovers at a continuous rate, we can see that merchants have managed to improve their processeses significantly. By the second half of August, relative customer satisfaction levels across the main dimensions measured have evened out.
Stay tuned for an updated second half of August deep dive into German and Norwegian e-commerce behavior very soon.