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In today's world, consumer behaviour is the key for success or failure of a company – and for many businesses the holiday season is the most important selling season. We have identified key trends that define consumer spending and shape the future of commerce. Thereby, ESG is at the top of consumers’ considerations and a reason for businesses to re-think their B2B strategies.
While some people enjoy some return to normality, the past two years have fundamentally changed the way we shop. Consumers are ready to celebrate, shop and travel this season, but they’re still wary about public-health considerations in the wake of the Corona virus variants. Now as the 2021 holiday season approaches, many retail businesses are wondering what this year has in store. One thing is clear: even as in-store shopping has begun to pick up, e-commerce will be the channel of choice.
We identified key themes in e-commerce that drive the 2021 holiday season – themes that will be relevant for the future in general and apply to B2B as well. Three of the key trends for this holiday season are the eager-to-spend millennials, the importance of trust, and what your own brand stands for:
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Trend 1: Spendy millennials power the uptick
The rise of the digital natives has become reality.
B2C
Consumers have already illustrated that brand loyalty can be elusive by their willingness to experiment with a variety of brands over the past several months; exceptional customer experience can motivate them coming back. While price and convenience are more important to baby boomers than to other age groups, the financially strong millennials show other distinctive characteristics. They display the highest holiday budget and are eager to spend it on travel and on buying environmentally and socially responsible brands. Millennials are more likely to shop via smartphone than consumers overall, and they also favour in-store pickup more than other age groups. Consumer-facing companies are carving out space in physical stores to accommodate in-store pickup and convenient, cost-effective returns for online purchases.
B2B
Millennials are also shaping B2B commerce. They – and their younger peers, the GenZ’ers – are taking over the workplace. It’s estimated that by 2025, up to 75% of the workforce will be technology-savvy millennials, who are now at an age to be the professional B2B decision-makers and account for most professional B2B purchasing decisions. They don't want to wait on the phone, or worse yet for an email response. They prefer self-service options and digital channels to which they've become accustomed as consumers. And they bring a different set of expectations and buying habits. These young professionals want to know where their goods are sourced, and where the used materials or ingredients come from. This will have a significant impact on an enterprise’s broader transformation goals and journeys.
Trend 2: Trust takes centre stage
More than ever before, brand trust matters to consumers.
B2C
Since shoppers increasingly care about public-health issues when they shop in stores and about cybersecurity and privacy issues when they shop online, brand trust has come into sharper focus this year. And who is better to trust than someone you know? 85% of shoppers surveyed in the study said that local stores and independent retailers will figure prominently in their purchasing decisions.
Thereby, every touch point with a consumer offers an opportunity to build trust. Retailers may nurture trust by delivering reliable products and services, often with private-label brands that secure a loyal following. They can also provide a secure digital and physical environment, convenient shipping and return options, and a customer service provided by digitally savvy associates. It‘s important to note that consumers keep raising their expectations for the brands they engage with – so companies’ offerings and brands must meet their customers’ environmental and social requirements.
B2B
Before businesses dive into B2B e-commerce, they should ask: “How can we set ourselves apart from our competitors?” In a crowded marketplace, brand trust is a key differentiator. In the end, you want your customers to trust that you meet their needs and create a flexible and frictionless online buying experience that complements your existing channels. The core of omnichannel is about knowing your customers, their habits, patterns and needs, regardless of which channel they use to approach you. This has a huge impact on the way your enterprise's data model is set up, and how you know and track your customer.
"B2B e-commerce is not about digitalising the product catalogue. It’s about digital commerce as an integrated business function that truly connects with customers and makes their lives easier."
Trend 3: What does your brand stand for?
The trust in a brand is closely linked to a company’s ESG business practices.
B2C
Younger consumers are even more committed to ESG-issues (environmental, social and governance) than older age groups, as stated above. More than three-quarters of surveyed consumers said that they would discontinue a relationship with a company that disrespects the environment, its employees, or the community in which it operates. Furthermore, consumers want to support brands they can identify with – which includes brands created by diverse founders as well as size-inclusive models displaying the products. They are eager to hear a brand’s ESG story, typically looking for it on social media.
These consumer preferences give retailers the opportunity to tell their ESG story next to the point of sale, since many younger consumers take advantage of social commerce options. Additionally, brands can drive their relevance by communicating their values – Swiss brands, for instance, do this by including the ‘Swiss made’ logo to portray their local values.
B2B
In the B2B space, putting the customer at the centre of all your business activities is not only about trust, but also about building a unique brand. Creating a good e-commerce experience means putting yourself in your customers’ shoes along their journey from awareness to consideration to shopping to purchasing again. It means understanding their pain points and removing obstacles. And let’s be clear: differentiating yourself means going well beyond simply digitalising your product catalogue. It’s about aligning the entire organisation to serve the client at its core.
"Millenials want to support brands they can identify with and believe in. They are eager to hear a brand’s ESG story, typically looking for it on social media."
Key findings
- For the coming holiday, consumers want to combine a variety of online and in-store options.
- Consumer-facing companies are carving out space in physical stores to accommodate in-store pickup and convenient, cost-effective returns for online purchases.
- Companies can increase customer loyalty by providing exceptional customer experiences.
- Every touch point with a consumer offers an opportunity to build trust.
- As the millennials and GenZ’ers are taking over the workplace, B2B e-commerce is not an option anymore, but an imperative.
- To stand out from the competition, B2B e-commerce must start with the customers and their true needs.
- Online and offline channels need to be combined in a way to give customers the convenience they need and to allow each channel to remain profitable and deliver added value.
What's next?
If you’d like to explore how you can increase your company’s ability to compete and thrive, get in touch with our experts:
https://pages.pwc.ch/core-contact-page?form_id=7014L000000Pm87QAC&embed=true&lang=en
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Contact us
Partner, Leader Customer Transformation, PwC Switzerland
Tel: +41 58 792 47 97
