Gift cards, money, and gift baskets or flowers were cited as the top categories in consideration as gifts. As expected, uncertainty prevails around in-store shopping this year, and gifts that can be easily purchased online or distributed via mail may be more highly sought after. The days of shoppers queuing up at 5 a.m. to catch limited-time, in-store door-buster deals, pursuing the last must-have tech of the season, or trying to find their proper sweater size amid towering stockpiles may be over—at least for now.
Our study also showed that 23 percent of shoppers are planning to spend less on gifts this year. Aside from the gifting aspect, travel plans are “up in the air” for many, and in-person gatherings with family and friends may be smaller, if not virtual. Yet the uncertainty of the holiday season clearly pales when compared to the daily personal anxieties consumers are feeling on a much broader scale. 2020 will undoubtedly be remembered as a year of unparalleled disruption, and by extension, consumer transformation. This consumer shift towards digital commerce was inevitable. Still, it was catapulted 10 years into the future in a period of just over eight weeks due to shelter-in-place orders and store closures. An overwhelming surge in demand resulted in a severely disrupted supply chain that has yet to fully recover. Shipping delays remain a concern, which may suggest why consumers are getting a jump on their holiday shopping lists.
Retailers are getting an early start to the holiday season as well. Amazon Prime Day, which has typically been held in July, took place in the third week of October this year. As other retailers follow suit, we see what may indeed become the new, unofficial start to the holiday shopping season. Retail has been undergoing its own evolution for some time now, but the pandemic has acted as an agent of both acceleration and magnification. The number of retailers filing for bankruptcy is at a record high, and a growing number are closing their doors on Thanksgiving to allow employees the day off to spend the holiday with family. Notable industry events have been vastly altered or canceled altogether—what things will look like in the future remains to be seen. These shifts collectively embody the substantial extent and rapid pace at which the industry is evolving, hopefully for the better. This evolution must continue with fundamental changes needed that focus on what matters most—the consumer.
Values-Driven Shopping
This year consumers are focusing more on the things they value, and they want to shop with brands they can trust.
Over the past decade, trust in principal institutions like government and media outlets has been low. According to the 2020 Edelman Trust Barometer Spring Update Report, trust in these entities rose in the face of the pandemic (trust in government increased 9 percentage points; trust in the media up 2 points). Presumably, consumers had more trust in these institutions out of basic necessity during a time of intense anxiety and confusion. These data imply that there is a trust deficit, wherein opportunity lies for brands to help fill that void. A supplemental report from Edelman, which centered on brands during the coronavirus outbreak, found that behind price and affordability, trust is the second-most-important factor shoppers consider when deciding to purchase from a new brand. When competitive differentiators such as price, convenience, and fulfillment are essentially equal, shoppers will need a more significant motivator to push the buy button.
The importance of brand trust is nothing new but is arguably more visibly consequential in the gig economy model. Here, consumers trust strangers to deliver their take-out, drive them to their destination, and complete everyday tasks. If consumers are unsatisfied, they leave a bad review that can make or break the purveyor’s reputation, while signaling to others that this purveyor can’t be trusted.
During the lock-down orders, consumers endured rampant out-of-stocks, long delivery wait times, and for some, price gouging for essential items in limited supply. As a result, consumers were pushed into using new brands, and like most newly adopted behaviors during this period, these new habits will likely stick. The penalty for brands that went out of stock has been a forfeiture of brand loyalty. The pandemic has ultimately raised the stakes for acquiring shoppers’ trust.
A post in the Psychology Today blog posits that trust is exhibited as a set of behaviors, and results from the actions of another. The same is true of commerce, where shoppers put their faith in brands to deliver on their promises. But the principle of trust can be illusory and fragile in a digital world. Influencer and social media messaging can come across as out-of-touch or disingenuous. Consumers read product details, real-time inventory proclamations, and shipping projections, and put their trust in the information that is stated.
In light of the pandemic, these once-perfunctory shopping behaviors are now purposefully executed. Consumers have more time to become better informed about the products they want and the brands from whom they will decide to purchase. But brand trust extends much further than the transaction; consumers are looking to brands to take a solid stance on important issues plaguing our society. Words that ring hollow are no longer tolerated—consumers are looking to your actions as proof of reward. Case in point: brands that stepped up during the early weeks of the outbreak to donate much-needed resources have thrived.
So as shoppers give differently, so too must brands. Trust must be at the core of all that you offer and cultivated at every customer touchpoint. Each experience and message you deliver is a building block that supports your foundation of brand trust. It is built over time, but can crash at any moment. You have to work to make it as solid as possible and rebuild where necessary. We’ve got eight actions to help get you started now.