The buying habits of buyers tend to change slowly. Covid-19, however, has been disruptive enough to shake them up, and companies are trying to take advantage of it.
Josh Silverman, CEO of Etsy, an online marketplace focused on artisanal and vintage goods, described how he sees the pandemic reshaping normal consumer behavior during an August 5 earnings call to discuss the final quarter of the society:
We are all creatures of habit, and a lot of shopping is about habits. There are very few times in your life when you have the opportunity to change your habits. The three classics are when you get married, when you move [your] at home and when you have a baby. And if not, your habits are pretty cemented and you are not really open to forming new habits. And so what this current moment has created is a time when everyone’s habits are up for grabs.
Etsy’s merchandise sales climbed 145.6% to $ 2.7 billion in the quarter as it sold shoppers everything from masks and DIY kits to custom furniture for offices to home. Probably the most significant change that benefits the business is the shift to online shopping.
Before the arrival of Covid-19 in the United States in March, e-commerce accounted for around 12% of retail sales in the country. That figure increased as states issued orders for shelter-in-place that closed stores and kept shoppers at home, creating favorable winds for a company like Amazon. But even as states began to reopen, e-commerce remained high, according to data from Bank of America.
In May, Target CFO Michael Fiddelke described the online shift as a new habit rather than a passing trend. “When you get back to college, the first time you move into your new home, these steps are important to us as a retailer and always have been, because that’s when the habits of buy may change, ”he said on a call with investors and analysts. “Across America right now, we’re seeing an accelerating shift in buying habits when it comes to digital.”
It’s not the only new habit taking root. The Economist used Google search traffic for clues as to how lifestyles are changing and found that users still search for terms related to cooking, crafts and exercise above pre-pandemic rates. There has been a noticeable spike in interest around such products as gardening supplies, baking flour, and Crocs.
Companies are eyeing these changes in consumer behavior to see where they can find opportunities. “Research shows that 50% of consumers between the ages of 18 and 34 now plan to exercise even more,” Adidas CEO Kasper Rorsted said in a call for results on August 6. “We are seeing an even more pronounced shift in fashion towards leisure. The increased flexibility of the workplace is here to stay. And the majority of companies are planning more and more permanent teleworking. Of course, when you sit at home you don’t wear your suit, you don’t wear a tie, but you tend to wear Adidas sneakers or hoodies, and that definitely helps us prepare for the future. .
Retail experts have predicted that Covid-19 could reshape even more behavior. Not all will remain strong once the pandemic has subsided. Online grocery sales increased, but their growth also moderated with the easing of restrictions.
Yet the question is not whether Covid-19 has changed shopping habits, but by how much. This is a question companies will continue to ask themselves as they attempt to work on their future.