For tomorrow's shoppers, digital native doesn't mean digital only
Brands and retailers should always be wary about making assumptions about their consumers and their target markets. It is a principle taught as one of the very first lessons in marketing and brand building.
One such assumption widely held about retail is that, as time goes on, digital channels will become centre stage, marginalising and even eradicating the need for physical, in-store retail. This, the narrative goes, will be largely driven by young people, the consumers who, leading lives immersed in the internet, smartphones and social media, are most comfortable and adept in digital environments.
There is even statistical evidence to back up such a view of digital progression in commerce. In our own Future Shopper Report 2019, for example, we found clear evidence of the different roles digital technology plays in the shopping habits of younger and older consumers. For example, two thirds of consumers under the age of 35 told us that they expected to increase their use of digital channels in the future, compared to less than half of over-55s. More than half (52%) of 16-25 year olds told us that they were more likely to buy from a brand that was ‘digitally innovative’, compared to 38% of 45-54 year olds and just 26% of over 55s.
So it is easy to understand why, when it comes to planning out long-term commerce strategies, brands might be tempted to focus heavily on digital. They might also consider that, as today’s children reach maturity - the first generation of ‘digital natives’ who have grown up with online shopping, Amazon and home deliveries - the proportion of shoppers showing a preference for digital commerce and demanding innovation from brands is only going to rise.
It’s not that such assumptions are entirely incorrect or counter-productive. But brands and retailers should be very cautious about how far they run with them. Does, for example, the fact that young and emerging consumers are likely to use digital commerce more than older generations mean that they are no longer interested in going to a store or having non-digital commerce experiences? Does it therefore follow that future strategic planning should involve scaling back non-digital investment accordingly?
Not according to our new Generation Alpha report, a groundbreaking study of the opinions and attitudes of 6-16 year olds on all things shopping. From what our survey found, being a ‘digital native’ does not equate with being ‘digital only’. Today’s children still have interests and preferences that stretch far beyond the digital realm in all aspects of their lives, including shopping.
Stores are still a draw…
One particularly striking piece of evidence to come out of our survey was that, for all the focus on today’s youngsters leading digital lives, it seems that much of their experience of retail - gained through the shopping habits of their parents - still comes through physical stores. When asked where their parents bought most things for them, the most popular answer was in a supermarket (29%). This was followed by Amazon with 26% and after that came the high street - although this seems to be more of a British cultural phenomenon, named by 24% of UK respondents (and so ranking above the 23% that said Amazon) but just 2% of US children.
The continued connection young people have with physical stores through their parents’ is important because more than half (54%) of our survey participants told us they are more likely to shop the way their parents do. What is more, today’s children overwhelmingly say they like shopping in an actual store - three quarters (75%) told us so. By contrast, just over a third (39%) agreed that they preferred to buy something online rather than in a shop. Only 13% said they would like a future where everything was bought online and no one needed to go to a store anymore.
Perhaps the most important takeaway for brands is that the children of today put digital and in-store retail on more or less an equal footing in terms of their preferences and expectations. When asked how they would most like to shop in 10 to 12 years’ time, the most popular answer with 21% was using some kind of device with a screen, like a mobile or PC. But only just behind this with 19% was going to an actual shop. Interestingly, amongst 13-16 year olds, who might be thought of as just getting their first taste of freedom as consumers, going to a shop was the most popular option, with 25% of the vote.
We also got hints that children recognise the value of the different experiences they can get by shopping online and going into a store. Asked what they would most like to change about shopping, more than a quarter (27%) said they would like to see shops have an area where they can go to try out gadgets or play with toys before they buy - a hands-on experience lacking through digital channels. Interestingly, 74% told us that they like to see the same products online and in-store. While this suggests a desire for consistency of choice wherever they shop, it also reflects on habits revealed in our Future Shopper survey, were participants told us they research products online before buying in a store, or look up pricing on Amazon as they browse in a shop. Are children picking up on how different channels can be put to different uses?
…but omnichannel is the holy grail
Finally, it should be acknowledged that there was a slight divide between boys and girls in their attitudes to physical retail, which correlates with what we know about gender differences in the habits of adult shoppers. Girls, for example, were more excited about shopping in store when they were adults - the 22% who named this the number one way they’d like to shop in 10-12 years’ time put it top above using a screen, and was noticeably higher than the 15% of boys who said the same. 77% of girls said they liked shopping in store compared to 71% of boys, while 43% of boys said they preferred to buy something online compared to just 34% of girls.
However, boys (31%) were more enthusiastic than girls (24%) about the idea of having areas in shops where they could try out products like toys and gadgets. So even if brands do consider that their male audiences are more attracted to the convenience of digital, while females enjoy the experience of in-store, they should still consider that there are ways to win boys over to the idea of going to a store, and vice versa. Ultimately, it all really does come down to knowing your audience as deeply as possible, and acting accordingly.
In summary, then, the assumption that the children of today will expect or prefer a retail landscape dominated by digital when older is not supported ny what they have to say about shopping. Yes, digital will play a key role. But young people continue to enjoy, and in some regards have a preference for, the kind of experiences they can get from going to an actual store. Looking at long-term commerce strategies, brands and retailers should focus firmly on omnichannel, on delivering attractive, seamless experiences in-store as well as across all digital touchpoints which, when combined, meet the various needs and expectations of all their customers.
Want to explore this further?
You can read about our view of the future of physical retail in this 2019 report, which looks at the opportunities and pitfalls for retailers and brands, why bringing digital touch points in-store is essential, and what a hybrid future looks like for physical retail. Download it here.
If you’d like to discuss any of the themes raised in the above article, you can connect with our specialist eCommerce experts. Simply fill in the form here. Alternatively, for information on our services to help you connect with this new wave of consumers, visit our Services page.
A note about the report “Generation Alpha” by Wunderman Thompson Commerce
Research for this report was conducted by independent research consultancy Censuswide. A total of 4,003 children aged between 6-16 were interviewed online during July 2019; 2,002 in the UK and 2,001 in the US.