Recent research by FreedomPaya global payment technology company, and Retail economya leading retail insight company found that UK shoppers are spending over 28% more time searching and browsing for products online this year compared to the same time a year ago.
The research also shows that customers are using this extra ‘browse’ time not only to look for good deals, but also to do more due diligence on the products they’re considering to make sure they’re making the effort. are worth buying.
The idea that customers are more cautious comes as no surprise given the current macroeconomic environment and the pressure higher interest rates and inflation are putting on personal and household budgets.
What is interesting, however, is that this extra surfing time is not evenly distributed across age groups. It’s particularly pronounced among shoppers under 35, with half reporting spending more time ‘browsing’ compared to last year – about six hours a week – which is more than double the amount of time they spend browsing by those aged 55 and over.
Again, a keen sense of caution among younger age groups makes sense when you think about it other research sources suggest that younger age groups are currently facing the greatest pressure on their income and standard of living.
The bad news for retail brands, however, is that spending more time browsing online doesn’t automatically mean more sales or even the same level of sales as in previous years. In fact, research from FreedomPay and Retail Economics shows that online retail sales have fallen by nearly 15% over the past year.
But it’s not all doom and gloom.
Despite the pressure on customer budgets, the research shows that personalization is still important in customers’ minds, with nearly 55% of people saying they continue to appreciate personalized offers and discounts while shopping. Furthermore, the research shows that just over 30% of all retail purchases made by 18 to 35 year olds can be attributed to personalized marketing.
So, what does effective personalization look like in such a challenging economic environment?
Pressados recently released 2nd Annual Customer Motivation Report offers a valuable perspective. Using a class of generative AI called Motivation AI, Persado analyzed how customers responded to nearly 21 billion messages across more than 3,200 brand campaigns over the course of 2022.
In terms of retail, they found that campaigns and content focused on conveying timelessness and versatility were the best performing campaigns in 2022. Conversely, campaigns focused on ease and convenience, which are typically expected to perform very well more likely to underperform. -perform than overperform in 2022.
Persado’s report further predicts that the themes of topicality and versatility will continue to perform well in 2023. It adds that the theme of quality is also likely to make a strong impression as consumers look for well-made and durable products.
These findings are consistent with research from FreedomPay and Retail Economics and suggest that to deliver an engaging and personalized experience in the current climate, brands need to go beyond knowing a customer’s name and make suggestions and inferences based on their purchase history or digital behavior. . To stand out from the crowd, they also need to understand the context and motivation of their customers.
By focusing on customer preferences, their emotional drivers and the context in which they shop, brands can both deliver the personalized experience their customers love and drive sales, even in the face of economic and competitive challenges.