Older Shoppers Are Becoming Online Consumers
Lowe’s digital transformation efforts seem to have it well placed for the future, if a new survey of more than 4,000 consumers around the world — more than half of them in the U.S. — is any guide.
“Our research shows that once restrictions ease, new online shopping behaviors look likely to continue, particularly for younger consumers,” said Melanie Noronha, senior editor at The Economist, which conducted the survey. “Once restrictions lift, you will see some return back to stores, to a certain extent. But about 60 percent of respondents will retain some of their new online shopping habits, and that includes about 55 percent of baby boomers.”
In fact, said Noronha, the most dramatic shifts toward online shopping during the pandemic took place among older shoppers, with baby boomers increasing their online spending (as a share of their total spending) from 25 percent to 37 percent, followed by Generation X, whose share of online spending climbed from 39 percent to 47 percent.
Overall, retail spending dropped by 9 percent during the pandemic — but online spending increased by 15 percent. Retailers around the world, recognizing this big flip in their industry, have responded by aggressively accelerating their digital transformation projects.
“We’re seeing there’s now a seamless experience between on- and offline shopping,” Noronha said. “For instance, a consumer could go in-store, discover a product and then place the order online, or they could discover it online and then go in-store to test it and purchase it.”
How to Reduce Friction In Retail Transactions
For Lowe’s, Ellison said, the goal is to simply deliver on customer expectations.
“It’s not about our competition or what will happen in the macro environment,” he said. “It’s about being customer-centric: If a customer wants a simple in-store transaction, how do we execute that in a way that’s flawless and frictionless? If a customer wants to buy online and pick up in-store, buy online and pick up in a locker, buy online and we’ll ship to your home — as we think about all the ways customers want to shop and the ways they’ll shop in the future, that dictates our capital spend and our innovation strategy.”
Lowe’s built a store navigation app to help in-person shoppers find what they need, among other in-store innovations. It was a leader in offering secure lockers outside retail locations where customers can pick up online orders. And it’s been following the buy online, pick up in-store trend, as well.
Whatever the tech solution, Ellison said, the key is to remove all friction from the shopping experience. “As my CIO, Seemantini Godbole, says to me often, the most effective technology is the technology no one sees. It’s always behind the scenes. And all the customer knows is, ‘This was really simple.’ And the associate in the store, in the distribution center, and in the corporate office is saying, ‘This system works so well and is so intuitive.’ So our innovation is focused making things simple without putting anything in front of the customer or associate.”
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