Consumers, Commerce and COVID-19: Adjusting to the “New Normal”

The dawn of summer in the northern hemisphere and winter in the southern hemisphere brings with it signs that businesses and consumers are adjusting to the “new normal” as we progress through the third month of the COVID-19 pandemic.

Retailers deemed non-essential at the start of the pandemic are reopening with social distancing guidelines in place. Office buildings are welcoming workers back to areas that had sat deserted as non-essential businesses enforced mandatory work from home policies. Bars and restaurants are beginning to open their patios, and in some parts of the world, such as Australia, indoor dining areas with modified capacity requirements aimed at keeping people safe.

One trend that we are noticing on our network is a global increase in interest in subscription boxes.
Consider:

• In Australia, subscription boxes have experienced an AU$20 increase to their AOV since the start of lockdown.
• Sales for subscription boxes have grown by 180% YoY in the U.K. since the start of lockdown.
• Subscription boxes in the U.S. have shown an AOV increase if 50%, while sales had YoY growth of 150% since lockdown began.

The appeal of subscription boxes around the world is likely being driven by three factors:

• Subscription boxes provide consumers with the peace of mind of having products they need delivered right to their doorstep without having to come into contact with another person.
• Convenience: Rather than having to head to the store, subscription boxes allow consumers to get regular replenishment of products they’re using on a regular basis.
• Peace of Mind: Consumers may be signing up for subscription boxes because they know upfront whether or not the products they want or need are going to be available.

But while consumers are expressing increased interest in subscription boxes, the vast majority of retailers and brands don’t have them among their offerings. That being said, store-based retailers can learn a thing or two from the underlying reasons around why consumers are turning to subscription boxes during the pandemic as they seek to leverage digital marketing channels to drive traffic to store locations.

Here are some tips on how retailers can do just that:

• Develop an online strategy to support the reopening of stores (O2O): As stores reopen, multichannel retailers should employ online-to-offline (O2O) strategies to help fuel in-store purchases. Text ads, site links and callouts within Google or Bing ads can provide important information to consumers such as which store locations are open or showcase offerings such as click-and-collect. Local Campaigns and Local Inventory Ads are geared explicitly towards driving in-store traffic. Using a combination of these strategies can help elevate a retailers O2O search strategy. Retailers can also engage affiliate O2O publishers to help connect the promotional digital experience with in-store purchases with the use of coupons and vouchers, or card-linked cash back offerings.
• Promote Curb-side or Click & Collect: While consumers are getting more comfortable with leaving the house, not everyone is in a hurry to head back to a store. A survey of US consumers from June 9-11 by market research firm Morning Consult showed that 35% say they’re comfortable going to a shopping mall, suggesting that most shoppers still aren’t entirely comfortable resuming pre-pandemic shopping habits. Curb-side pickup or Click & Collect provides a happy medium by allowing a consumer to order what they need online and pick it up with limited contact.
• Ensure Local Store Inventory Accuracy: Every trip to a store counts these days more so than it did pre-pandemic. Retailers can stand out by making sure they are promoting products that are readily available in stores nearby, thus giving consumers the peace of mind that comes with knowing that a trip to a store won’t be wasted.
• Clearly Communicate Safety Measures: Now is the time to leverage all of your digital channels to over-communicate what you are doing to keep consumers safe when they visit one of your stores. Update local store social channels with necessary information about what is being done, whether that’s sanitising registers after each checkout, requiring masks when entering a store, or promoting the use of mobile payment options to minimise the amount of physical touch points.

Rakuten Advertising will continue to keep you updated with strategies and insights from our network. For more strategic insight, specific to your company, please reach out to your Rakuten Advertising representative. For more insights and data related to COVID-19, visit https://rakutenadvertising.com/covid19/.