Online Retail’s Next Phase: From Adapt To Accelerate

Overnight changes in consumer habits are usually rare, with inertia and habit difficult to overcome under normal circumstances. But circumstances have been far from normal this year, making consumers receptive to change in ways never seen before, according to Chris Abele, vice president of digital commerce strategy at Fiserv.

“During the pandemic, we have seen three times the normal [eCommerce] growth rate, if not more in certain sectors,” Abele told PYMNTS in a recent conversation. “Obviously, consumers are looking to buy everyday goods online as opposed to going inside a store, [and] we effectively have seen two to three years of eCommerce growth in a matter of three or four months. That’s a massive shift.”


It’s a shift Abele said has been seen almost everywhere — across vertical and demographic segments — and one that seems likely to stick. Consumers aren’t going back to their old ways, he said, which means the only thing left for retailers to think about is how to build the omnicommerce experiences customers are beginning to adopt today and will expect in the future.

“If you look at the trends over the past six months, digitization is actually holding steady — meaning it’s not a one-time event or a spike, but actually something that we think [merchants] will have focus on for the foreseeable future,” Abele said. “That means a rapid acceleration in terms of eCommerce penetration.”

Building The Next Level Of Preparedness 

The first phase of responding to COVID-19 was largely an all-hands-on-deck drive toward digitization, Abele said. Merchants focused on what they could do immediately to adapt to a reality where physical channels were shut down and all action was found online.

This saw such things as retailers quickly building ordering capabilities into apps or quick-service restaurants (QSRs) finding new space to add additional drive-thru capacity. “So, that first mode was: ‘What can we do to get ourselves up and running and support the shift to eCommerce?’ ” Abele said.

But the second phase of this effort is moving beyond mere “adaptation” to “acceleration,” he said. Brands are looking to create omnicommerce customer journeys flexible enough to accommodate the new set of preferences consumers have become habituated to and that speak directly to them.

For instance, Abele said one particular area of focus is loyalty programs and moves to make them digitally relevant and accessible. The digitization of loyalty and rewards isn’t new, he said, but attempts to enhance and optimize them have gone into overdrive in COVID-19’s wake.

“The more that we see sectors of the economy shift to online, the more that we think loyalty programs integrated into a mobile app or integrated into the consumer's digital experience are important,” he said.

For example, coupon-enthused grocery shoppers can easily use those coupons — and like to do so — when shopping in-store. But to make digital grocery work for them, grocers must develop ways those shoppers can order ahead and still benefit from coupons, Abele said.

Digitization’s goal isn’t to simply transplant the physical experience online, he said, but to take the parts that a customer most values in a single channel and make them enjoyable and easily accessible across all channels.

Recreating How We Pay 

Abele said a digital transformation of payments is just as critical as the accelerating consumer adoption of digital commerce.

For example, he said consumers are realizing that touchless payments at the point of sale (POS) aren’t some neat feature or clever technology trick, but a vital safety option in the coronavirus era. That’s why a range of mobile payments — digital wallets, QR codes and in-store app payments — are now seeing a significant increase in consumer adoption for the first time in the U.S. market.

And he said we’re going to see payments become even more expansive in terms of the mechanisms involved. For instance, consumers could soon connect bank accounts to move funds, encouraged (and possibly even rewarded) by merchants looking for a lower-cost way to enable digital transactions.

Abele also foresees the inclusion of Amazon Alexa and other voice platforms into the commerce marketplace to better enable touchless consumer payments. For instance, Amazon, Fiserv and ExxonMobil on Tuesday (Sept. 1) rolled out their Pay at the Pump with Alexa system at more than 11,500 Exxon and Mobil stations nationwide.

Abele said that’s just the beginning of connecting up tech like Alexa to enable pay-by-voice in a wide variety of “practical” and “no-touch” contexts. “We believe that those new experiences are a great way for merchants to change the dynamic of the consumer interaction,” he said.

A focus on streamlining consumer interactions is also reshaping how businesses are moving money from the business back to the consumer. Abele noted that Fiserv is working to further digitize how funds are disbursed from businesess out to a consumer; doing so digitally will allow consumers to receive funds faster, and provide the payout recipient more choice in how funds are received.

The tough news is that it’s hard to move from “getting up and running” to digitally optimizing consumer journeys for consumers who’ve suddenly become very different shoppers than they used to be. That takes a lot of data parsing and a very forward-looking orientation.

But the good news — and the light at the end of the tunnel — is that the world of commerce on the other side will almost certainly be better than what existed before, driven by those organizations that fully commit to executing their digital evolution correctly.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.