What COVID-19 Has Taught Us About U.S. Ecommerce Spending

Despite spikes of COVID-19 cases in certain parts of the country, some brick-and-mortar retailers are still in limited reopening mode. Malls and grocery stores will likely be less crowded than before with new safety protocols in place.

Although some shoppers are looking forward to returning to their stores, others will be more inclined to continue to shop from the safety of their home. The shift to ecommerce caused by COVID-19 will linger well after social distancing policies are lifted.

However, these behaviors vary from shopper to shopper and even between retail segments. For example, millennials and baby boomers have demonstrated far different shopping activities, and channel preferences for shoppers buying groceries vs. say, consumer electronics also varies.

To truly gauge how consumer behaviors have pivoted among retail categories and demographics, PFS recently surveyed 2,000 U.S. consumers. The research reveals certain retail categories have seen a surge since the forced move to ecommerce, while others are anxiously awaiting the return to store shopping. As well, age and gender play a significant role in determining shopping behaviors. We explored the changes COVID-19 has presented across different demographics and categories.

Consumable Retail Goods See Ecommerce Surge

Since the onset of COVID-19, many consumers have been forced to use online as their sole shopping channel. This change put a strain on global supply chains, while having a lasting impact on merchants across many retail segments. It has also led to changes in consumer brand preferences, based on online availability. Our survey looked at how shopping behaviors fluctuated across the following retail categories:

  • Apparel and footwear
  • Jewelry
  • Health and beauty
  • Office supplies
  • Consumer electronics
  • Groceries and household products
  • Home and garden

As have many other studies, our data clearly shows that consumable goods have seen an increase in ecommerce volume since the start of the pandemic. There is a sizeable gap between the groceries/household items and health and beauty categories compared to other market segments. It is worth noting, however, that our study showed purchases in home and garden did not see significant growth. This could be due to the essential nature of consumables like groceries and a lack of ecommerce adoption in retail prior to the pandemic.

COVID-19 also influenced changes across ecommerce websites due to several factors like availability and delivery times. Across all categories, over four in ten consumers have shopped with online retailers/websites they haven’t used before, increasing to 58% of jewelry shoppers during the pandemic.

Because of a perceived lack of availability, consumers are also ordering items earlier than usual to allow for longer delivery times. This is the case for 40% of shoppers across all categories and rises to 47% in jewelry and 50% for groceries/household items.

Younger Consumers Embrace Ecommerce

There are also demographic variances. Unsurprisingly, younger consumers lead the way in ecommerce shopping. Baby boomers and the silent generation are the least likely to have shopped with a new online retailer or website during the pandemic, while 75% of millennials have done so, and 56% of millennials have tried at least one new brand.

Looking further, 46% of millennials and Gen Z have made more online grocery purchases, compared to just 28% of baby boomers and the silent generation. In health and beauty, 35% of millennials and Gen Z have made more online purchases compared to 15% for baby boomers and the silent generation.

Additionally, 62% of millennials and Gen Z have shopped with new online retailers and websites for home and garden products, compared to just 32% for baby boomers and the silent generation. In apparel and footwear, 55% of millennials and Gen Z and 28% of baby boomers/silent generation made more online purchases since COVID-19 broke.

Also, worth noting are shifts in shopping behaviors based on gender. Men are more likely to buy more online products and shop with new online retailers and websites during the COVID-19 pandemic than women.

Social distancing has radically transformed consumer behavior for many. Breaking down these behaviors by retail segment and demographic paints a much clearer picture of what has changed due to the pandemic, and what commerce will look like moving forward.

Some market categories like consumables have benefited from the shift to ecommerce more so than others, and only time will tell if these behaviors stick after the pandemic. What is clear, is that retailers must be prepared for a prolonged period of increased adoption of online shopping, and thus higher ecommerce volume across the board.

Zach Thomann is EVP and GM of PFS