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COVID-19 Retail Trends in An All-DTC World

Earlier this year, Bluecore released its 2020 Retail Trends report, based on a survey of what 200+ retailers were prioritizing for 2020. With the onset of a national and global pandemic, supply chain crisis, and a hard-hit economy, a lot has changed since then. The insights and trends that lent to retailers’ original 2020 planning reflect a different time and a different customer mindset.

Bluecore has set out to understand what new consumer and shopper behaviors mean for retailers, in the new now.

To do this, Bluecore reviewed shopper interactions with and activity across over 70 retail brands in the apparel, beauty, pharmacy, sports/outdoors, and luxury sub-verticals. Bluecore then reviewed shopper interactions with and activity across three business models: traditional chain stores, traditional department stores, and digital natives.

The following insights are based on analysis of 14.5 billion shopper events on these brands’ ecommerce sites, including adding products to carts, clicking on emails, viewing products, and completing sales transactions. Bluecore gathered this data from 1.8 billion first-party cookies, 1.3 billion cart events, 42.9 million unique products, 115.9 million orders and $17 billion in total sales. We compared current activity with activity in the weeks directly leading up to the pandemic in March, as well as month-over-month as well as year-over-year, using 2019 insights as a baseline for 2020 performance. The complete methodology can be found in the Appendix of this report.

Trends by Business Model

How have online purchases changed for each business model?

 

  • Online purchases increased year over year and month over month across all business models, which is reflective of the overall increase in activity across sub-verticals outlined in this report.

How have first-time purchases changed for each business model?

 

  • Department Stores see a decrease in first-time buyers year over year and month over month, which could suggest that the majority of first-time purchases typically occur in-store.
  • Traditional Chain Stores spike in first-time buyers could be attributed to an increased investment in ecommerce, with more opportunity to grow online than an already established Digital Native.

How have second-time purchases changed for each business model?

 

  • Traditional Department Stores see a decrease in second-time buyers year over year and a slight increase month over month, once again potentially indicating the importance of the in-store experience for these brands.
  • Overall, Traditional Department Stores’ lower performance on first and second-time buyers compared to their counterparts could indicate a lack of investment in the digital platforms (i.e. poor discovery on the website, clunky check-out process)

How have add to cart events changed for each business model?

 

  • Add to cart events increased year over year and month over month across all business models, which aligns with the increase in online purchases.
  • Digital Natives see the fewest add to cart events, potentially due to their typically limited or nuanced product offering.

How have viewed product events changed for each business model?

 

  • Consistent with the sub-vertical findings, viewed product events have increased year over year and month over month across all business models.
  • Traditional Department Stores’ small 4% increase month over month, perhaps further supports the importance of the in-store experience for browsing.

How have email signups changed for each business model?

 

  • With the exception of Traditional Department Stores, email sign-ups increased year over year and month over month. The overall decrease in Traditional Department Stores by 9% since April 2019 but increase since February 2020, could indicate shoppers’ renewed interest in potential offers in the current climate.
  • Similarly, the spike in new email sign-ups for Traditional Chain Stores and Digital Natives, could once again demonstrate shoppers’ interest in offers in exchange for their email address during this time.

Trends by Sub-Vertical

How have online purchases changed for each sub-vertical?

 

  • Online purchases increased for all sub-verticals both year over year and month over month, which is likely indicative of the majority of sales moving online with store closures.
  • Shoppers could be diversifying their shopping habits, since we see less of a discrepancy between Pharmacy, which sells pandemic essentials and Luxury, Beauty, Sports/Outdoors, and Apparel, which sell other goods.
  • Apparel is seeing the smallest increase across the board, perhaps due to potential halts on seasonal merchandise normally seen during this time.

How have first-time purchases changed for each sub-vertical?

 

  • First-time buyers increased for all sub-verticals both year over year and month over month, potentially indicating shoppers’ willingness to experiment across many brands while in quarantine.
  • Luxury’s stark increase in first-time buyers at 181% since 2019, could be a seasonal spike or it could be related to potential increases in discounting to recoup cash flow from in-store closings during this time.
  • Beauty’s 129% jump from February to April 2020 could once again indicate shoppers’ willingness to experiment, this time with self-care related products as they maintain a sense of normalcy while at home.

How have second-time purchases changed for each sub-vertical?

 

  • Second-time buyers increased for all sub-verticals both year over year and month over month, representing shoppers’ willingness to return to brands during this time.
  • The outpacing of Beauty at 129% since 2019 and 116% since February, could indicate that in the absence of the typical try-and-buy in-store experience often offered by these brands, shoppers are relying on brands they are familiar with from their first purchase.

How have add to cart events changed for each sub-vertical?

 

  • Add to cart events increased for all sub-verticals both year over year and month over month, which lines up with the overall increase in purchases.
  • Pharmacy and Luxury have seen the largest add to cart rates across both time periods. This interesting juxtaposition of sub-verticals could potentially suggest that in additional to buying essential products, as shoppers save money on leisure activities like going to restaurants and traveling, they’re more willing to buy high-value items.
  • Apparel has the smallest increase in both time periods, which could be related to shoppers’ potential shift from the need for seasonal-specific products to comfortable work-from-home items.

How have viewed product events changed for each sub-vertical?

 

  • With the exception of Sports/Outdoors, viewed product events have increased year over year and month over month. The small increase YoY at 3% and the small decrease MoM at 5% for Sports/Outdoors, could indicate that these buyers are already aware of what products they want to purchase before landing on the site.
  • As expected, Pharmacy sees a surge in viewed product activity, likely as shoppers limit their in-person trips.
  • The general increase in viewed product events across the board is a potential indication of shoppers spending more time “window shopping” while at home.

How have email signups changed for each sub-vertical?

 

  • With the exception of Apparel, email sign-ups increased year over year and month over month across all sub-verticals. Apparel’s 3% decrease since April 2019 could represent a shift in brands’ promotional strategies as they determine how to promote Spring and Summer merchandise in order to be able to support inventory for the following season.
  • The overall increase in email sign-ups demonstrates shoppers’ willingness to share their contact information, perhaps suggesting a higher purchase intent than what is typical.

APPENDIX

Detailed Methodology

 

We digested this data in two ways: first, we examined performance for retailers in the beginning of April and compared this to performance the same week in 2019. YoY comparison is essential to understand any seasonal trends. We then compared data from the beginning of April to the beginning of February, prior to any store closures or large impacts on retailers in the United States and Canada. From there, we calculated averages for each sub-vertical across an array of clients, including

  • Luxury
  • Apparel
  • Beauty
  • Pharmacy
  • Sports/Outdoors

We also calculated averages for various retail business models, including

  • Digital Natives: digital-first brands that first launched with an online presence
  • Traditional Department Stores: brands that first launched with a brick-and-mortar store selling an array of products across multiple sub-verticals (examples of such stores could be JCPenney and TJ Maxx)
  • Traditional Chain Store: brands that first launched with a brick-and-mortar store that expanded to many locations and sell an array of products concentrated around a few or less sub-verticals (examples of such stores could be CVS, Sephora, or Stuart Weitzman)

We examined performance based on a few key interactions for each brand:

  • Add to cart events → the average % change of add to cart events 
  • Net new email captured → the average % change in new email addresses captured 
  • Online purchases → the average % change in online purchases
  • Viewed products → the average % change in products viewed online
  • First time purchases → the average % change in new buyers shopping online
  • Second time purchases → the average % change in repeat buyers shopping online