For years, direct-to-consumer (D2C) retailers have relied on tools like free shipping and discounts to encourage purchases among online shoppers. But now, the ecommerce landscape isn’t quite so simple.
In fact, we’re beginning to see a rising preference among consumers for highly personalized and engaging shopping experiences.
Recently, Nogin commissioned The Harris Poll to conduct a survey among more than 2,000 US adults aged 18 and older.* The survey shows that a significant majority of Americans are active online shoppers with 96% having made online purchases in the past year, and 26% having made an online purchase in the past 24 hours.
Notably, while the data showed that traditional incentives like free shipping (81%) and discounts (68%) still top the list of what inspires online shoppers to make purchases, consumers are increasingly motivated by personalized experiences, with 20% of online shoppers saying they are inspired by personalized promotional emails and 17% by personalized brand recommendations.
Now, with the holiday season on the horizon, it’s especially vital that D2C retailers embrace the rising tide of personalization, strengthening their ecommerce capabilities to build better, more engaging experiences, targeted to each individual shopper.
As retailers strive to align ecommerce strategies with diverse consumer preferences, here are four key trends to keep in mind:
Personalized experiences help drive buying behavior among online shoppers
The data is in and it’s clear that personalized experiences matter to consumers. Among online shoppers, 20% report that personalized promotional emails serve as a compelling motivator for making a purchase, while 17% find themselves swayed by personalized brand recommendations. The survey found that, among online shoppers, men are more likely than women to be inspired to make an online purchase based on personalized recommendations from a brand (19% vs. 14%). Meanwhile, younger online shoppers are more likely to be influenced by personalized recommendations than their older counterparts (22% of 18-44 year olds, compared to 12% for 45+).
Social media is the new storefront as online shoppers of all ages make purchases through social ads
Social shopping is on the rise, perhaps due to how much time consumers spend on social media platforms, or because social algorithms deliver personalized recommendations that resonate more strongly with shoppers. As many as 70% of online shoppers say they make purchases directly through social media ads, with 29% of those who make purchases through social media ads saying they are making more purchases that way this year than they did last year.
Notably, social shopping has become prevalent among all age groups, including more than half (56%) of online shoppers aged 65+ who have made purchases through social media ads. Among those who make purchases directly through social media ads, those ages 18-44 are more likely than those ages 45+ to say they made more purchases through social media ads this year compared to last year (36% vs. 22%).
Free shipping is the top incentive that inspires online purchases
For many shoppers, the prospect of free shipping might be the tipping point that triggers a purchase. Free shipping (81%) and discounts (68%) top the list of things online shoppers say would inspire them to purchase online. Interestingly, more online shoppers would be inspired to make an online purchase if free shipping is offered (81%) than if free returns are available (48%).
Lack of integrated payments, high shipping costs and difficult return policies are likely to cause an online shopper to abandon a purchase
Consumers want ease throughout the shopping experience — and they don’t want to pay too much for shipping. In fact, more than 3 in 4 online shoppers (78%) say high shipping costs would make them likely to abandon an online order (78%), followed by difficult return policies (44%). Meanwhile, almost 1 in 4 online shoppers (23%) say not having integrated payments at checkout would increase their likelihood to abandon their online purchase.
However, the impact of purchase abandonment due to the lack of integrated payment offerings and buy now, pay later (BNPL) options varies by age: Online shoppers ages 18-34 are twice as likely as those ages 35+ to say not having integrated payments at checkout would increase their likelihood to abandon their online purchase (36% vs. 18%). With regard to BNPL, online shoppers ages 18-44 are more likely than those ages 45+ to say not having the option to pay with BNPL services would increase their likelihood to abandon their online purchase (18% vs. 7%).
Want more insights into online shoppers’ attitudes and behaviors? Check out the press release here. For the full results of Nogin’s survey, please email: roger@nogin.com
*This survey was conducted online within the United States by The Harris Poll on behalf of Nogin from August 29-31, 2023, among 2,041 adults ages 18 and older, of whom 1,973 are online shoppers (i.e., have made a purchase online in the past year). For complete survey methodology, please contact nogin@bocacommunications.com.
