As lockdown restrictions are proposed to ease, retailers are starting to think about how to reignite consumer demand for non-essential purchases. UK retail sales suffered the biggest decline in 25 years last year as the closure of non-essential shops during lockdown outweighed the online spending boom fuelled by the covid pandemic.In fact, even the most popular high street retailers have recorded their sales volumes down as much as a 24% year on year, despite the increased demand for online shopping.
It’s no surprise that the pandemic has resulted in a shift in consumer behaviour as the world pivoted to the new way of living. There has been an overall decline in consumer spending as well as a change in shoppers’ preferred payment methods. Covid-19 has nearly diminished the use of cash, amplified the adoption of contactless and increased the demand for alternative payment methods such as digital wallets and instalment based options, with millennials leading the new payment wave.
As for brick-and-mortar, pre-pandemic high street retailers were already seeing a dive in footfall and sales, which Covid has only further exacerbated. Retail executives are suggesting they’ve seen a 5-7 years’ acceleration from offline to online as businesses have been forced to optimise their ecommerce platforms. Even the smallest retailers have been shoved into the modern ecommerce era in order to stay afloat.
So, what do all of these changes mean for non-essential retailers? Most importantly, how are retailers shifting their propositions to spark a demand for non-essential products in today’s competitive online landscape?
There will remain multiple factors outside our control post-Covid, however, one key element which retailers must consider is creating a better payment experience for their customers, especially as the world continues to shop online. A checkout flow that removes friction and makes it as easy as a click of a button or scan of a QR code to make a purchase will improve the user experience drastically – a topic which Mode will be discussing in our upcoming webinar: The rise in Alternative Payments – A remedy for boosting sales and customer retention?
In March 2020, some industries were seeing nearly 90% of shoppers adding items to their basket and starting the checkout process but failing to complete the payment. As the demand for non-essential products continues to decline, it’s never been more important for retailers to capture and convert shoppers that have shown an intent to buy. By removing any form of friction and making it quick and easy for consumers to carry out a transaction will minimise the drop off rate. In fact, experts estimate that conversions can be increased by over 35% by implementing the right checkout optimisation strategies.
Additionally, a knock-on effect of the shift to online shopping has resulted in less loyal customers as consumers are presented with endless options. The majority of the new problems relate to poor online payment experiences suggesting retailers were not ready for the digital onslaught. It is imperative that these issues are addressed if retailers wish to reignite consumer demand.
So how do you put this into action? Mode, the UK’s next-gen payments and loyalty platform, will be hosting a Live Talk with L.K.Bennett CEO Darren Topp, to discuss how and why retailers should lean on alternative payments to help them drive up conversion rates and navigate their way through the current pandemic.
Darren will be joined by ex-Alipay UK CEO Rita Liu and FinTech expert Janis Legler, for an interactive discussion on the 25th February at 11am. Our expert panelists will share their thoughts on:
- How and why consumer payments preferences have evolved
- How retailers can boost sales and loyalty through a better payment experience
- The rising importance of a frictionless checkout flow in reducing cart abandonment
This Live Talk was broadcasted on 25th February. Stay tuned for the recording!