As PYMNTS continues to chronicle business impacts of the novel coronavirus, patterns are emerging that suggest how much things actually have changed in just a twinkling.
At least, it looks that way on the surface. It may be more accurate to say that society’s digital shift was a convergence of trends and forces already at work, particularly in commerce.
Things just needed a push, but they got a shove. COVID-19 turned 40 percent of consumers from in-store shoppers to eCommerce regulars virtually overnight. Many now say it’s for keeps.
To better understand these COVID-era phenomena, PYMNTS’ September 2020 How We Shop Report: Measuring The Rapid Digital Shift, done in collaboration with and supported by PayPal, surveyed nearly 2,200 U.S. consumers to discern evolving preferences, and to learn how merchants should respond with experiential shopping that leverages hot financial products.
“The convenience of using digital payments such as QR codes resonates so well that one-third of the consumers that prefer them would not even consider making purchases in a physical store without them,” the new study found. “We also found that 48 percent of consumers who prefer POS credit would not consider making purchases at merchants” that don’t have it.
How We Shop is a primer on meeting the new expectations around digital that are seen as “unequivocally important” to maximizing conversions, and ultimately increasing profits.
‘Store No More’ For Many Post-COVID
Ongoing surveys by a multitude of organizations confirm what PYMNTS research first detected back in March — that the biggest digital shift to come out of the coronavirus pandemic is the rise of online shopping at the expense of physical retail. That’s been in flux for some time; the pandemic sealed it.
“The share of consumers shopping less for retail goods in stores and more online increased 28 percentage points since March, and the share ordering from restaurants online instead of at physical locations increased 14 percentage points during the same time frame,” according to How We Shop Report: Measuring The Rapid Digital Shift.
“The extent to which consumers have gone online to shop and pay depends on the type of purchase being made, however.”
Among the most ardent online purchasers are grocery shoppers, who have embraced digital ordering in droves and opting for new curbside pickup and contactless delivery options.
“Consumers’ appetite for online grocery shopping has continually increased,” per the report. “The share of consumers buying groceries online increased 14 percentage points since early March and shifted from 15 percent to 18 percent between May 23 and June 22.”
It’s reflected another way in the new data: “Eighteen percent of consumers surveyed in April said they had shifted to shopping for retail products online but planned to shop in stores after the pandemic — only 9 percent of consumers surveyed in June said the same.”
In other words — and in another finding with potentially huge implications — only about half of the people who said in March that they would return to physical retail after the COVID all-clear said they probably won’t after all.
Payments Choice And Merchant Choice
Noting that 57 percent of consumers now pick merchants partly based on the payments options they offer, “They are particularly interested in using contactless payment options, as 26 percent and 23 percent of consumers say merchants must accept contactless cards and offer curbside pickup, respectively, for them to feel comfortable shopping in a store,” How We Shop states.
“This underscores a widespread desire to avoid more traditional in-store payment options, such as cash or cards, which require consumers to make physical contact with paper bills and POS terminals.”
These days, payments choice popularity goes hand-in-hand with loyalty, or at least it should.
In addition to the new purpose given to old QR code technology in recent months, How We Shop found that “Other common digital payment options that tend to weigh heavily on consumers’ willingness to make purchases include touchless payment options, including digital wallets, contactless debit and credit cards and ‘buy now, pay later’ options, such as POS credit.”
“Our survey shows that 40 percent of consumers who prefer digital wallets would not buy from merchants that did not accept them,” according to How We Shop. “Thirty-seven percent of consumers who prefer paying with contactless debit and credit cards say they would not complete purchases if they were unable to use those cards to pay for them.”