Consumer Behavior in Ecommerce: How It Is Evolving & How to Keep up With It

To succeed in ecommerce, you need to implement strategies to attract them and turn them into paying customers. But for those strategies to be effective, you need to understand how potential customers think and behave. In other words, consumer behavior analysis is critical.

The results of consumer behavior analysis will depend on your sample population, but we can also generalize how modern consumers behave based on general observations and studies. 

In this article, we’ll look at how online buyers have evolved and how you, as an ecommerce store owner, can keep up to get those conversions. But first, let’s look at the specific benefits you can get if you monitor consumer behavior.

Why Monitor Consumer Behavior

When we speak of consumer behavior, we refer to how consumers choose and use products or services. That includes how consumers think and feel about brands, their actions while researching products and shopping, and why they choose the way they choose (more on this later).  

You can increase conversions when you understand how consumers behave because this knowledge allows you to do the following things:

• Develop loyalty strategies: When you know how your customers behave, you can develop strategies to keep them. A mere 5% increase in customer retention can increase a company’s profitability by 75%. 
• Drive marketing efficiently: Knowing how your website visitors behave can help you create more targeted marketing campaigns. Complement that data with solid ecommerce marketing strategies, and your campaigns will surely drive purchases.
• Reduce operating costs: Since you know how consumers behave, you can use your resources to implement strategies that deliver the highest return and reject those that don’t deliver the desired outcome.
• Enhance customer experience: When you have data on how consumers behave, you can create seamless experiences on your ecommerce website.  91% of consumers have said they are more likely to shop with brands that provide a personalized experience, according to Revuze.

Monitoring consumer behavior entails time and investment. But in the long run, it will give you a lot of benefits. If you’re not monitoring consumer behavior, you’re missing out on opportunities to optimize your resources and get the best results to grow your ecommerce store.

Factors Influencing Consumer Behavior

Understanding consumer behavior requires that you understand the factors that influence consumers to behave in a certain way. There are four: personal, psychological, social, and cultural. Let’s look at them one by one.

Personal factors refer to a person’s demographics such as age, gender, socioeconomic status, lifestyle, and personality. All of these can impact purchasing power, which plays an essential role in deciding whether to purchase a product. 

Psychological factors are a person’s attitudes, perceptions, beliefs, learnings, and motivations. These factors are difficult to measure but can be powerful when it comes to driving consumers to act the way they do. 

Social factors refer to the external forces that drive consumer behavior. Humans are naturally social beings. That means the people around them can influence how they think and act. Peer pressure and social proof are both common social factors. A person may decide to purchase a new cell phone, for example, because that person’s family and friends say it’s the best on the market. 

To be effective, owners of all types of ecommerce stores should develop strategies taking these factors into account. 

For instance, you can include positive customer reviews on product pages to provide social proof and drive website visitors to purchase. You could also put out ads to influence perception and make consumers believe a product is the best solution to their problems. And so on. 

How Online Consumers Behave

Ecommerce has continued to grow, with 2020 forecast to be its strongest year yet. The massive shift from offline to online due to COVID-19 led to a more than 22% growth in online sales, with Forbes reporting a 149% year-over-year growth in US and Canadian orders as of April 21. 

Even those demographics who typically used to prefer the brick-and-mortar store have changed their shopping habits. According to a LaserShip study reported by Supply and Demand Chain Executive, nearly half of baby boomers (47%) plan to increase their online shopping even after the pandemic. 

Even so, according to Intelligence Node, Gen Z and millennials still represent the most significant portion of the consumer buying pool, with an astounding $350 billion in combined spending power.

As consumers shift online, they no longer focus on just one channel to make their purchases. The rise of social media and ecommerce platforms gave online buyers multiple shopping avenues, which they are now leveraging. The online consumer is an omnichannel consumer, with no loyalty to a single medium. 

Quality, convenience, and cost continue to influence the purchase decisions of online consumers. 

According to Smart Insights, 32% of online shoppers said product quality matters the most to them when shopping online. Although only 13% said convenience matters most, it ranked third among the most important factors to online consumers. 97% also said they had backed out of a purchase because the shopping experience was inconvenient for them.  

The LaserShip study said that 19% of respondents stopped shopping at an online retailer because of expensive shipping costs. But Gen Z and millennials tend to be willing to overlook a higher shipping cost if there is a next-day delivery option. 

Referrals are still one of the main reasons online consumers pick a brand over another. According to Social Media Week, 80% of consumers are likely to purchase a product based on a friend’s suggestions. 45% said that reading reviews, customer feedback, and comments influences their purchase decisions.

What Online Sellers Can Do

Now that you know how online consumers behave in general, let’s talk about what you can do to keep up. In this section, we’ll look at four strategies that will help you stay ahead of the game and keep delivering your customers the top-notch experience they expect. 

1. Use Multiple Channels to Sell

Since consumers don’t stick to one platform when shopping online, you should find ways to sell your products using various online media. So if you’re selling primarily via Facebook, you need to find ways to sell via your website or Instagram as well. Or, if you already have an ecommerce store, your store will do better if you also sell through social media channels. 

The platforms you choose for your brand should depend on your target market. If you’re targeting young people, Facebook and Instagram may just be the platform for you. If you’re targeting professionals who are advanced in their careers, LinkedIn is best. Here’s a quick breakdown of the demographics of the typical users of each social media platform, according to Viewership:

• Facebook: most widely used social media platform; 29.7% are aged 25 to 34.
• Instagram: great for pictures. Users are mostly teenagers and young adults. Females use this platform more than males.
• Twitter: Dynamic platform. Great for promoting products in 280 characters or less. Largest group of users is “affluent millennials”.
• LinkedIn: mostly used by professionals and companies.
• Pinterest: mostly used by middle-aged people with above-average income.

Although branching out is a given, there’s a right and wrong way to time this. According to ecommerce experts, you should move to other channels only after you’ve saturated your first platform. In other words, master one channel first, then move on to the next. Two or three platforms that are serving you very well are much better than ten you hardly use! 

2. Offer Quality, Affordable Products

Look critically at your products. Are they of high quality? If not, don’t even attempt to sell them until you’ve done a redesign. Assuming they are of high quality, don’t use that as an excuse to charge exorbitant prices. Remember, online buyers don’t just look at the product quality. They look at how much the item costs, too.

For small business owners, shipping costs are a given. The question is this: How do you make online consumers who don’t like to pay for shipping purchase your product? Shipbob offered some advice:

• Adjust the product price to absorb the shipping cost (the customer sees that shipping is free, but you’re not out of pocket. Everyone is happy!) 
• Charge customers a reduced shipping cost and only slightly increase the product price.
• Offer a flat rate shipping fee using a blended average shipping cost across all orders.
• Require a minimum spend in exchange for free shipping (e.g., “free shipping on all orders over $50”).

It’s all in the way you present your product. Make online consumers believe they are getting a bargain for your product, and they are more likely to purchase it.

3. Put Your Customers First

In everything that you do, you need to put your customers first. That means you need to focus on the customer experience in their every possible interaction with your brand. 

So make it easy for your potential customers to buy from you. Make sure your site loads quickly and is optimized for different devices, so it looks great whether the customer is using a desktop or a mobile device. Did you know that over half of all online traffic globally now comes from mobile devices? 

Focus on how potential customers will navigate your website. Do they have to go through numerous steps before they can get to a product page? How easily can they check out? If you’re sending them to a squeeze page, are there too many fields to fill out? People want everything they need to be available with minimum effort on their part. If they can’t get that from your site, they will likely leave and go to your competitors.

The best way to ensure you’re giving your customers an enhanced experience is by A/B testing your pages. Invest in quality CRM software to get to know your audience and build better relationships, allowing you to respond to your customers’ needs.

4. Provide Social Proof

Don’t forget to include customer reviews on your product pages. Online consumers are more likely to purchase a product if someone else endorses it. 70% of online consumers will trust a recommendation even from someone they don’t know, according to BigCommerce. Have you ever performed a search for a product on a platform like Amazon and filtered the results so only products rated 4 stars and above appear? That’s the power of social proof. 

Social proof can come in many forms. For example, if you’re managing social media accounts, your number of followers and engagement rates can be a form of social proof. Customers can also leave reviews for a brand directly on some social media channels, such as Facebook. 

Media reviews can help lend legitimacy to our brand and help sway online consumers into making a purchase. So if a newspaper or a magazine references you in an article, include that on your site. Brooklinin cites its write-ups in Men’s Journal, Good Housekeeping, and Today. These household-name publications are a powerful form of social proof. 

Remember, you want to convince consumers you’re the real deal. What better way to do that than to let other people tell them on your behalf? 

Wrapping Up

To succeed in ecommerce, you need to understand how online consumers behave. When you understand online consumer behavior, you can create strategies to connect with consumers and address their pain points. That will make you stand out from your competitors and increase your chances of getting those conversions.

This article looked at how online consumers evolved and what you can do to keep up. Now it’s over to you. Make the necessary adjustments based on what online consumers want. Use marketing tools to promote your products, and don’t forget to monitor how things are going. 

With time, you’ll see those conversions increasing, and your brand will be way ahead of your competitors.

Here’s to your best year yet!