The ‘new normal’ isn’t that new, many trends were there before Covid hit
The growth of direct-to-consumer brands is not just about the flight to ecommerce during Covid, but also offering convincing answers to consumers’ questions.
We’re preparing for the ‘new normal’, whatever that means. But can what faces us be described as new? Has the pandemic really created new consumer behaviours, or has it simply catalysed behaviours that were changing anyway?
The initial Covid-19 crisis saw huge changes to the structures and norms that we took for granted. Consumers filled their homes to the brim with toilet roll and pasta, parents grappled with home schooling and DIY haircuts, while online grocery delivery slots became a valuable commodity in their own right. All the while, people mused over what the so-called new normal might be.
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It would be both easy and natural to look at the Covid-19 pandemic as something of a seminal moment in changing how consumers engage with brands. But while consumer behaviour was put into a state of shock by the prospect and eventual imposition of a lockdown, the behaviours that followed were not all that surprising. Toilet roll hoarding aside, they were behaviours that had been developing long before lockdown.
The drive to online throughout the consumer journey
Rather than making fundamental changes to the way consumers think and act in relation to their shopping habits, Covid-19 appears to have simply accelerated shifts that were already well underway, particularly in how technology and digital mediums play a role in how we buy goods and services.
Necessity quickly bred familiarity and, increasingly it appears, preference. Data from Visa reported a 41% increase in online purchases, with 74% of consumers likely to maintain those habits in the future.
Much of this growth is coming in product categories that were not traditionally associated with ecommerce and online purchasing. McKinsey reports that the biggest growth areas in the UK for online retailing are set to be groceries, over-the-counter medicines, personal care, alcohol and household goods – categories where adoption of online shopping was generally lower, but where necessity has created a demand for online purchasing.
Consumers were demonstrating an increasing level of demand for information and assurance about purchases long before the Covid-19 pandemic.
Those findings are supported by Google Trends data, which highlights the extent to which search terms appended with the qualifying term ‘online’ saw a significant spike as the UK lockdown was announced in March. Growth that appears to be driven by consumers relatively new to the idea of online purchasing has, tellingly, sustained even as lockdowns have eased.
But the growth of online as a touchpoint for consumers is not exclusive to the bottom of the funnel, where consumers have simply turned to it for transactional fulfilment. The shift is happening throughout the customer journey as consumers look for reassurance and confidence in their purchases.
The desire for assurance and the informed consumer
Consumers were demonstrating an increasing level of demand for information and assurance about purchases long before the Covid-19 pandemic caused them to be significantly more apprehensive than usual. Searches appended with the phrase ‘how to’ may have soared following the imposition of lockdown, but the trend line was pointing upwards long before we were ordered to stay at home.
Even in relatively low-consideration product categories, where so often brand recognition and price were previously key differentiators, consumers are making greater efforts to learn more about whether and how products fulfil their needs.
They are turning to social proof to be convinced why Brand X is better than Brand Y, turning to search to look up their specific need, and becoming more interested in the provenance and the credentials of products that they are buying.
Brand building still matters, but consumers need more convincing and assurance that what they are buying is a product that they can believe in. Those who shout loudest do not necessarily win the argument, but they do have an opportunity to use that brand authority to make the argument more convincing.
Offering assurance is the key to competing with DTC brands
Direct-to-consumer brands were quick to spot these trends. It’s easy to say that the growth of DTC lies simply in order fulfilment and logistics, but the real success is arguably in the way they responded to that growing trend for a consumer’s need to be convinced and assured. They saw that consumers were questioning their purchasing decisions, questioning established norms that said that a pack of razor blades needed to cost £15, and seeking assurance on products. Through a combination of brand building, search marketing, logistics and business models that drove loyalty and lifetime value, direct-selling brands started to win that argument and steal market share.
Traditional brands can compete with this. While many manufacturers have gone on a spending spree to acquire these DTC brands, their legacy brands are actually well placed to talk to consumers on these new terms. They have brand authority and recognition – what few of them are doing is using that authority and recognition to engage audiences.
As more of these manufacturer brands invest more heavily in ecommerce channels, there is a very real opportunity to build brand communications that reflect a new normal that is actually not that new at all.
Download Stickyeyes’ free guide, ‘The Ecommerce Evolution’, to find out how to keep attracting and keeping the attention of consumers in this evolving retail economy.
Michael Hewitt is content marketing manager at Stickyeyes.