Shipt Sees Financial Pressure Driving Online Seasonal Sales

As economic pressures continue to constrain consumers’ spending power, Shipt is seeing on-demand delivery shoppers turn to deals and concentrate their engagement around peak times.

In an interview with PYMNTS, Katie Stratton, chief growth officer at the Target-owned on-demand delivery aggregator, spoke to how consumers’ shopping habits have changed in the last year.

“People crave convenience and value, so we are constantly looking for ways to provide that for our members. In the past year, we’ve seen engagement in our promotions with higher-than-expected volume around popular seasonal moments,” Stratton said.

She added that the company “take[s] a look at the data and closely compare[s] year over year” to identify the most effective ways to offer “savings opportunities” to offer to members.

Indeed, deal-seeking behavior is becoming quite common. In fact, PYMNTS Intelligence’s study last year, “Consumer Inflation Sentiment: The False Appeal of Deal-Chasing Consumers,” which was based on a survey of more than 2,100 U.S. consumers, found that 46% of retail shoppers are deal chasers, willing to go wherever they will get the best price. Retail giants are targeting this demand with seasonal sales events such as Amazon’s Big Spring Sale and Walmart’s beauty-focused savings event.

The Home Improvement Move

In an effort to capture this trend toward seasonality, Shipt recently announced the addition of its first home improvement partner retailer, Lowe’s, to its marketplace, with Stratton noting that this launch is timed to coincide with consumers’ interest in “spring cleaning and outdoor entertainment.” By incorporating these products into the marketplace, the aggregator can capitalize on seasonal spikes in demand and align its offerings with current trends, maximizing sales opportunities.

She added that offering the retailer’s items on Shipt’s marketplace enables the aggregator to drive engagement “outside of a weekly grocery order,” especially given that consumers would explicitly ask for such options on post-order surveys. Additionally, the opportunities to drive engagement go beyond home improvement occasions.

“Home improvement represents a huge vertical not only for DIY and gardening-focused individuals, but for those looking to stock up on cleaning products, outdoor decor, live plants and more,” Stratton said.

This diversification attracts a broader customer base and increases the likelihood of repeat visits and purchases. Plus, home improvement products often have higher price points compared to everyday consumer goods. Including these items can lead to higher average order values, contributing to increased revenue for the aggregator.

Shipt’s addition of Lowe’s comes as many consumers seek more digital shopping options from the comfort of their homes. PYMNTS Intelligence’s “2024 Global Digital Shopping Index: U.S. Edition,” created in collaboration with Visa Acceptance Solutions, which draws from a census-balanced survey of more than 2,400 U.S. consumers, found that more than 1 in 4 shoppers prefers to make purchases via digital channels with no interaction with physical stores. Plus, the study highlighted, U.S. consumers rely highly on a broad range of digital features, with 85% using multiple features regularly.

As consumers increasingly prioritize value and seasonal needs in their shopping habits, Shipt’s partnership with Lowe’s positions the aggregator to cater to these evolving behaviors.