Virtual by default: Covid-19 ushers in a new era of digitally-reliant consumers

Imogen Wethered
by Imogen Wethered

Millennial and Gen Z’s reputation as digital leaders might soon be in danger – it seems that now all generations want in on the omni-channel action. Here’s how the coronavirus pandemic has driven an increased demand for digital innovation and is fast-creating a ‘virtual by default’ world.

Covid-19 has brought about a number of strange phenomenons. For starters, doctors in neonatal intensive care units around the world have noticed premature births were falling during the lockdown, in some cases drastically. A research team in Denmark found that during the lockdown, the rate of babies born before 28 weeks had dropped by an incredible 90%.

One of the most likely factors behind this trend, doctors speculate, is that pregnant women were staying at home, resulting in them being more rested and less stressed from work and commuting. Other possible factors include less exposure to other strains of influenza, which can increase the likelihood of premature births, and less exposure to air pollution.

Another phenomenon that arose during the lockdown period was the accelerated adoption of virtual services. Sure, most shops were closed, so people had no other choice but to rely on virtual service options, and brands had no other choice but to build them. But stores have reopened and things are slowly returning back to normal, yet the demand for virtual service has never been stronger.

Remember back to the 2008 financial crisis – there was an increased demand for video conferencing tools, as many businesses were no longer able to front up the costs for staff travel. But when the world emerged from the recession and businesses starting making money again, video conferencing had earned a fixed place in the lives of professionals across the globe.

And in only a few short months of lockdown, consumers have come to rely on virtual service as a quicker, easier and cost-effective way to receive a service without having to visit a store – and we anticipate, in the months to come, that a significant share of consumers will become virtual by default in their thinking.

Interest in online and virtual services has skyrocketed

As anyone in the retail sector will undoubtedly be aware, footfall figures reached a standstill during the lockdown period while online sales went through the roof.

In May, ‘non-store sales’ accounted for 33.4% of all retail in the UK, a month-on-month growth of 19.7%, according to the Office for National Statistics.

Research from Barclaycard, found that UK consumers spent £40.6 billion on non-essential purchases during the lockdown, such as books, video games and subscriptions, totalling an average of £771 per person.

The US experienced similar behaviors, with the US census bureau reporting that the retail industry experienced a 17.7% rise in US consumer spending during May compared to April.

But this phenomenon goes deeper than an abnormal interest in e-commerce – there’s a strong demand for virtual service, too. According to Qudini’s survey of over 2,000 US consumers, 61% of consumers wanted virtual service by phone or video from essential retailers during the lockdown and 32% wanted virtual service across all retail types. There was a similar demand in the UK, with 54% wanting virtual service from essential retailers and 31% from all retail types.

There was also a strong demand for click and collect or buy online pickup in-store (BOPIS) services, with 67% of US consumers more likely to use this service at essential stores and 50% across all retail types.

And while social distancing and hygiene standards seem destined to stay in place for the foreseeable future, so too will the new demand for virtual service.

What does this mean for brick-and-mortar stores?

Brick-and-mortar stores will continue to play an essential role for retailers – they’re a crucial component for relationship building – but there’s no denying that many customers will come to prefer virtual service options, so much so that they will become virtual by default.

To remain competitive, retailers will need to broaden their service offering by catering for online and in-store services. Here are a number of examples of retailers that are already reaching virtual by default customers:

Brown Thomas’s virtual styling service

Prominent Irish luxury department store retailer, Brown Thomas, which is owned by Selfridges Group, is home to a number of high-end brands including Chanel, Dolce & Gabbana, Hermes and Burberry, and as such, many customers require a high-touch approach before making a purchase.

During the lockdown period, Brown Thomas decided to launch a virtual service that connected customers with style experts over video using appointment booking software. This turned out to be incredibly popular, and was great at attracting new customers to the brand – 60-70% of all customers using the service were new.

Find out more about Brown Thomas’ virtual service here.

Currys PC World’s contactless drive-thru collection service

Electronics retailer, Currys PC World, has launched a contactless drive-thru collection service outside more than 300 of its stores throughout the UK using click and collect software, and while social distancing plays a major role in the popularity of the pickup service, many customers have already come to rely on it as a quicker and easier alternative to entering the store.

Nike’s NikeTown Express Shop initiative

The NikeTown Express Shop service in NikeTown London allows customers to tell a member of staff what product(s) they want and in what size, and the staff member will go and grab the product for them. This saves customers from having to search for items themselves and queue to make purchases, limiting their overall time in-store drastically.

Ellis Brigham’s in-person appointment booking function

Mountain sports equipment and apparel retailer, Ellis Brigham, has made it safe and incredibly easy for customers to book appointments with in-store experts during Covid-19 using an online appointment booking system. Customers can book an appointment with a member of staff in advance for footwear fittings, backpack fittings, camping advice and clothing, and general equipment advice – and this service will no doubt become an expectation for returning customers in the months ahead.

Read: Ellis Brigham creates the perfect post-lockdown customer journey with appointment booking system

NatWest’s ‘Digital Lessons’

 

During the lockdown period, retail bank, NatWest, took the time to equip its customers with the digital skills they need to navigate its portfolio of online tools, such as its range of online banking functionalities. NatWest achieved this by hosting a series of ‘Digital Lessons’ that were easy for customers to access and attend using Qudini’s event management software. This approach not only helped customers out during the lockdown period, it has also created a customer base that will now be virtual by nature in their thinking.

 

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