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April 14, 2020
Salesforce Q1 Shopping Index Reveals How Consumers Are Adapting to the “New Normal”
By Rob Garf, VP of Strategy and Insights at Salesforce
Today we announced the Salesforce Q1 Shopping Index, powered by Commerce Cloud, which analyzes data from the activity of over one billion global shoppers. The following unique insights show how global buying habits are changing as a result of the COVID-19 global pandemic and stay-at-home orders.
Initial data and analysis suggest that we’re still in the early stages of shifting to a new normal, and we expect continued increases in digital commerce as more people look online to fulfill their needs. While digital commerce saw a surge in traffic and sales, this likely won't account for the significant decrease in brick-and-mortar sales that brands and retailers are experiencing.
Key Insights from the Q1 Shopping Index include:
- Ecommerce demand rises as brick-and-mortar traffic flatlines: Ecommerce revenue in Q1 2020 grew 20%, compared to 12% growth in Q1 2019, including 16% web traffic growth and 4% shopper spend growth (reflects average amount spent by shoppers per visit). We expect this will continue as companies double down on digital.
- Essential goods purchases turn digital: Shelter-in-place policies triggered a spike in digital demand for essential goods including food, personal care items and more. Between March 10th and March 20th, as the majority of the world was put under shelter-in-place guidelines, digital purchases for essential goods surged 200% and remained elevated for the rest of the quarter.
- Pick up in store brings convenience and safety for consumers: Sites offering buy online, pick up in store (BOPIS) grew digital revenue by 27% in Q1, compared with 13% for sites not offering BOPIS. Between March 10th and March 20th, digital revenue for sites offering BOPIS -- via curbside, car, drive through, or store pickup -- grew by 92% compared to 19% for sites not offering BOPIS over the same time period.
- Shoppers in COVID-19 hotspots turn to digital channels for essentials: Between March 10th and March 20th, shoppers in New York increased digital spend on essentials by 158%. California shoppers increased their spend by 230%, Washington state by 157%, and Louisiana by 167% during the same time period.
- Home Goods, Active Apparel, Toys & Games see large digital spikes: Consumers continued to make purchases for non-essential goods, even while stocking up on the essentials. Digital revenue grew by 51% for the Home Goods industry (like home decor and crafts), 31% YoY increase for Active Apparel (like athleisure), and a 34% YoY increase for Toys and Games.
- Brands and retailers increase discounts to drive sales: Discount rates in the U.S. surged to 34% in mid-March — higher than even the average 31% discount rate consumers enjoyed over Cyber Monday.
- US consumers shift peak buying times: Browsing and buying patterns show that US consumers spend less time online during the evening hours. Typically, visits and orders peak at 7 pm, but amidst the pandemic, consumer activities peak at 9 am.
Visit our blog to dive deeper into the data and explore how this new normal will change consumer behavior even after the crisis subsides. We’ll continue to share more insights in a series of posts to uncover how the retail landscape is shifting.
Q1 Shopping Index Methodology
The Salesforce Q1 Shopping Index, powered by Commerce Cloud, uncovers the true shopping story through analyzing the activity of more than one billion shoppers across more than 34 countries, with a focus on key 10 markets: U.S., Canada, U.K., Germany, France, Spain, Japan, Netherlands, Australia/New Zealand, and the Nordics. This battery of benchmarks provides a deep look into the last nine quarters and the current state of digital commerce. Several factors are applied to extrapolate actuals for the broader retail industry and these results are not indicative of Salesforce performance.