Time online has hit a ceiling and internet behaviours are shifting
Most adults spend almost half of their time awake online, through mobile, PC, laptop or tablets. People spent more time online during the 2020 & 2021 Covid lockdown years, however the daily average is now almost back to pre-pandemic figures – a sign that we’ve reached an internet saturation point.
At the same time, typical online behaviours we’ve seen since the internet’s creation are shifting - finding information, whilst still the number one reason people use the internet, is also one of the fastest-falling reasons why they use it. Social media algorithms are giving us information, potentially before we even know we’re looking for it, meaning that finding information doesn’t mean the same thing that it used to. Google’s own recent data has shown that nearly half of young people look to TikTok or Instagram instead of Google Search or Maps for answers.
Other foundational internet behaviours like sharing opinions, general browsing, and keeping up with news, whilst still popular, are slipping also. More people now say they see news on social media than they do on a news website, app or anywhere else on the internet.
The consequences of time online falling and behaviour shifts are broad and will be a challenge to address. A possible solution lies in incentivizing daily use by creating experiences that internet users can only do, and want to do, once a day – Snapchat, Wordle and BeReal are thriving on this.
Social media has become the first stop on the buying journey for many
The way that consumers are finding products is changing. Along with the decline in using the internet to find information, less emphasis is being placed on researching products – there has been an 8% drop in consumers saying they do this before buying an item since 2020. This has implications for many online retailers, who will need to rethink their approach to succeeding online.
Internet users are increasingly looking to find inspiration online. A ranking of 741,000 16-64 year old internet users found that ‘Finding Inspiration’, as being an important reason for using the internet, had jumped from 9th place in 2018 to 6th place in 2022, overtaking ‘Product Research’. Younger audiences are starting their search from a place of curiosity, and expecting to be led to new ideas, rather than directed to lists of brands or products.
The number of people doing their shopping-related research on social networks has shot up since 2015. These platforms have even surpassed search engines among Gen Z, and Millennials are coming close to this also. With these spaces being trend driven, brands need to keep up with what’s culturally relevant to their audience, if they are going to cut through the clutter. Younger audiences are also more likely to turn to Tik Tok to get honest reviews, than other online reviews from traditional search tools or big name influencers, so brands should consider visually showcasing real people and their views.
Discovery-led e-commerce is meaning that scrollers are more spontaneous than they were. 41% of Gen Z and Millennials make an impulse purchase online every 2-3 weeks, rising to 48% among daily TikTok users. This drops to 10% among Baby Boomers. Motivations for impulse buying are quite different between generations, and marketers will need to tweak their approach depending on who they are targeting. Older groups are more motivated by sales/deals, limited time offers and product usefulness, so social ads can be more product or information focused. Whereas younger generations impulse buy for a wider range of reasons, such as recommendations from their online community, flexible payment options and convenience with quick & easy online checkout process or social media “buy” buttons.
Businesses need to build their online shopping experience around the expectations that social media searches create, setting the scene for inspiration, discovery & ease.
Treat spending during the cost-of-living crisis
In the 2008 Global Financial Crisis, despite expecting consumers might cut down on treats, luxury lingerie sales soared. While the economic road ahead looks bumpy in 2023, it’s important for brands to remember that not everyone will be paring back spending completely. Many consumers will be carving out space for their must-have treats.
We know from previous recessions that products & services can quickly shift from essentials to treats, or to expendables, in consumers minds. While we don’t have a crystal ball, August 2022 research showed that the top 5 categories that consumers on a budget would buy as a treat for themselves were clothing, food/drink/snack delivery orders, tech items, dining out and travel.
Trust for a brand ranks third out of a list of 14 purchase drivers, coming ahead of discounts, good customer service, and purpose-driven factors. Previous recessions have seen the trust gap widen during times of uncertainty. As consumers lose confidence, brands that build trust with them become a safer bet.
In 2023 businesses can build trust by being open & transparent about how price changes are impacting their business, and focus on direct relationships with their customers to keep their loyalty even as they raise prices. At the same time, messaging and actions that demonstrate empathy can also have a similar effect.
As businesses increasingly compete on price, the retailers that look set to stand out are those that prioritise building trust, keep innovating, and drive empathetic, value-add messaging – focusing on the person behind the product.
Keep an eye out for our soon-to-be-published, more detailed, blog on marketing in a downturn.
Tech releases & developments to watch
Wearable technology ownership grew markedly during the pandemic driven by the increased health & wellbeing focus of consumers. Wearable technology and digital health-based offerings are likely to be a key battleground in 2023. TikTok acquired a Chinese hospital group in late 2022 which is an interesting diversification strategy for the entertainment-based tech giant, where there seems little obvious synergy.
In the Metaverse, Meta recently released its Quest Pro VR headset which they encourage users to use in virtual work environments where collaboration is key, rather than purely for entertainment. Apple will also be stepping into this territory, releasing a mixed reality (augmented reality & virtual reality) headset in 2023, with a goal of eventually replacing the iPhone with AR in 10 years. Coming at hefty price tags, uptake is likely to be slow.
Sources: GWI Global 2022, WARC 2022