Insights

How the Online Demographic is Changing the Future eCommerce Customer

Consumer shopping habits have changed dramatically over the last few years, thanks to the explosion of eCommerce

Shopping online is no longer the preserve of younger consumers, as lockdown forced us all to permanently change our buying habits – including many older customers. Meanwhile a new generation is coming of age, for whom eCommerce has always been a feature of the retail landscape. In order to appeal to these changing demographics, brands need to start thinking differently about the customer.

Silver surfers

Old habits have not so much died hard, as fast over the last 12 months. One of the most pronounced changes is the move to online grocery shopping among more mature consumers. According to a report by Waitrose, the amount of regular online shoppers over the age of 55 has trebled to 23% over 2020, compared with 2019.

But all online categories have seen an increase in this demographic. (Even before the pandemic, 2019 was the first year more than half of 65-year-olds and over had shopped online – according to the Office for National Statistics).

It’s little wonder this age group – which is also typically the wealthiest – is being coveted by online retailers. Boohoo’s acquisition of Debenhams’ website in January is one example of a young eCommerce brand seeking to broaden its appeal to older shoppers.

However, there’s still plenty that retailers can do to capitalise on the ‘grey pound’, particularly when it comes to improving the usability and accessibility of their websites. This includes ensuring fonts are of a good size with a strong colour contrast; simplifying page information and form completion, such as address look-up; and incorporating webchat tools.

Some of this may seem obvious, but according to a poll commissioned by design agency Beyond, 13% of over 65-year-olds said they found shopping online frustrating. And of course, improving usability ought to benefit engagement with customers across the board.

Generation Z

At the other end of the spectrum is the next generation of shoppers – the so-called ‘Gen Z’ (those born in the mid-to-late 1990s to 2010). This group may not yet have the same buying power as other demographics, but as more become consumers in their own right the challenge they pose to brands is how to stay relevant.

Unlike other groups this generation has come of age on social media. TikTok and Instagram are among the most popular channels they use to communicate – something brands must be aware of when looking to reach these new consumers.

However, if the cliché about millennials is their love of ‘experiences’, the marketing buzzword for Gen Z is the value they place on ‘authenticity.’ If brands want to communicate on these platforms, their messaging must have a clear purpose. This group is looking beyond the products and wants to understand what makes the company tick, says partner at McKinsey Bo Finneman. Not only do they want to know the mission and purpose of a brand, but its broader contribution to society.

Yet at the same time these young people are entering the workforce at a time of great economic uncertainty, meaning they – like many others – will also be looking for products that represent good value for money.

In other words, there are lots of factors at play when trying to understand changing consumer behaviour.

Smarter engagement

In fact, KPMG’s head of retail Paul Martin believes brands need to better focus on the purpose of the customer shopping journey, rather than just viewing their needs through the prism of age.

“What Covid of course has done, is drop many of these age barriers around the use of the online channel for all sorts of categories,” he says. “But purely connecting that with an age segmentation doesn’t work anymore.”

Truly understanding the customer is where retailers need to next spend their energy, with few doing things like personalisation well. “Brands who have been good at understanding their customer, who have been able to personalise their messages and offers – and I don’t just mean changing the name at the top of an email – those are the organisations that will win in the future.”

The key is to connect the customer with the product and their specific shopping mission.

“There will always be certain products that are always associated with certain consumer demographics, that is not going to change,” he says. “But don’t forget there may be a silver surfer grandmother looking for a specific video game for her young nephew or niece, which of course is a very different shopping mission than if the nephew or niece is buying it.”

In this new era of eCommerce, brands need to be aware of evolving customer demographics. But with so many new customers entering the marketplace, it is more important than ever to also understand what the individual shopper wants.