Survey: Half of shoppers plan to buy more online with markdowns

For consumers, it’s a summer of swings.

Forty-year-high inflation is pushing prices higher. The Fed moved to raise interest rates, making borrowing money harder across the economy. At the same time, retailers are set for big markdowns amid an influx of inventory.

With COVID-19 restrictions loosening, the retailers say the discounts come as a result of inventory ordered months ago in a supply chain crisis that doesn’t match with current demand for products that align with going out, rather than staying home. Most of the markdowns are coming in areas that were flying high in the pandemic. But when price pressure abounds, a sale is a sale. Track what’s being offered closely and there could be deals to be had.

“This summer will present both new challenges and new opportunities for brands,” said Vijay Ramachandran, VP of market strategy for global ecommerce at Pitney Bowes, in a statement. “Overstocks and markdowns will impact profitability, but also create new openings to sell as a large portion of consumers seek out deals—further aided by the return of Prime Day and other mid-year promotions. At the same time, our survey found a growing number of consumers cutting back on retail spending altogether as they react to record inflation and gas prices, and rising interest rates.”

A new survey from shipping company PitneyBowes looks at how consumers are planning spending as more markdowns on casual apparel, home appliances and furniture are heading their way. The results of the latest BOXpoll show that it’s set to bring a shift toward ecommerce.

Here are a few of the key data points:

• 49% of consumers, including 60% of millennials, are planning to buy more online as a result of these trends.
• On the other hand, 15% of consumers are unlikely to buy discounted items as they cut back on spending.

It’s a time of massive swings. As Ramachandran put it: “2020 saw unprecedented capacity constraints among ecommerce logistics networks. 2021 witnessed historic disruptions in the manufacturing supply chain. 2022 is shaping up to be the year of oversupply and price volatility.”

Consumers are changing habits along with it. According to the poll, 56% of respondents said their motivations for buying online have changed since the peak pandemic lockdown phase. The number one reason for shopping online was saving a trip to the store. That was a top choice of 43% of respondents. Meanwhile, COVID concerns are top-of-mind for 15% of consumers.

This makes delivery a key component of ecommerce, and speed is key. The survey showed the following:

• One-third of those who are shopping online more than they were three months ago said they are more likely to upgrade shipping for a faster service.
• 23% of parents and 22% of millennials are willing to pay for speed.
• Yet two-thirds of respondents said they are no more likely to pay for fast shipping now than they were three months ago.

It gets at another side of the ecommerce equation. As online shopping becomes more habitual, there’s one emerging dynamic that is tougher to quantify, but no less impactful: Ramachandran said many consumers are attracted by the “joy” of online shopping, and that will only continue to grow. It could even overtake convenience as a prime motivator.

It’s a note worth taking when designing ecommerce experiences. Remember how factors like a standout social presence and unboxing helped DTC rise. Going fast for consumers is important, but it’s important to remember that they also want to be delighted along the way.