A small yet significant number of consumers still haven’t joined the online shopping revolution. Any firm that ignores these analogue laggards does so at its peril
One of the most obvious socioeconomic effects of Covid-19 has been the way it has boosted the ascent of ecommerce. Online channels now account for about £3 of every £10 in retail sales in the UK, compared with £2 before the pandemic started, according to the Office for National Statistics. To match this increase in digital spending, retailers have been working to enhance the customer experience they provide online. Yet a laser-like focus on ecommerce can come at the expense of the many consumers who still shop the analogue way.
Research published by Deloitte in August 2021 revealed that 21% of UK consumers don’t have access to a laptop PC and 8% of consumers don’t own a smartphone. Companies that disregard the needs of this group risk alienating many potential customers.
“This could be a problem in the medium term if brands make choices based purely on economics without considering their impact on certain stakeholders,” says Ross Sleight, chief strategy officer at Somo Global, a digital product agency. “Such considerations are particularly important in key areas of the high street. For instance, the closure of a local bank branch can evoke high emotion among those in the community who feel disenfranchised and on the wrong side of the digital divide.”
He continues: “One of the biggest barriers to a company’s successful digital transformation is how to change customers’ behaviour. Consumers who are so accustomed to undertaking certain tasks in a particular way cannot be expected to change them immediately and embrace digital methods.”
Sleight suggests that, to ensure that no one is left behind by the transformation, brands should work with customers to help them develop digital literacy skills.
More than 1,200 of the 2,000 consumers who responded to an online poll by YouGov for Metro Bank in August 2020 agreed that British banks had given up on having a high-street presence. Just over half of those surveyed said that they still liked to speak to someone face to face when making a bank transaction. Among respondents aged over 55, the proportion rose to 62%.
“There’s clearly been a huge acceleration towards digital channels throughout the pandemic,” says Kat Robinson, Metro Bank’s customer experience director. “The digital revolution in services could be felt most profoundly by older people, who tend to be less digitally literate. Falling on the wrong side of this digital divide could be a life-changing worry.”
Dr Angelika Strohmayer is a senior lecturer at Northumbria University’s design school, where she studies interactions between humans and computers. She observes that “the pandemic has taught us that digitalisation can be a huge asset in reaching new people, but also that it leaves many others behind. For the latter group, it’s not only a question of having access to an internet-enabled device such as a smartphone or computer. It’s also about having the ability to use them.”
Katie Thomas, lead at the Kearney Consumer Institute, agrees that the digital divide is not only a function of the “growing income and wealth gaps across the UK”, although these are clearly a strong contributory factor. People who are getting left behind by the online revolution may well be able to afford the latest smart devices and high-speed access to the internet. It’s a matter of choice too, she stresses.
Some people simply shun digital tech, choosing not to participate in online transactions because they prefer a traditional, in-person retail experience, which could include using cash instead of card payments. A brand may take a calculated risk, knowing that these consumers are generally older and will eventually be replaced by a new generation of digital natives. But making the decision to ignore their preferences could damage its standing, Thomas warns.
“Racing towards the future but losing customers’ loyalty on the way is not a sustainable strategy,” she says. “If a business’s motivation to be innovative is making the firm outpace the slow process of consumer change, it’s time for it to slow down.”
Moreover, while companies may have a strong desire to race ahead with their digital transformations, cheered on by their most tech-literate customers, they need to remember that the laggards whose needs they’re ignoring are being left a long way behind. According to research published in September 2021 by Comdata, 29% of Britons “have very low digital engagement”. People in this group aren’t necessarily lacking an internet connection. Many of them have online access and digital skills, but they simply don’t want to use them. They’re the type of high-street shoppers who, when asked at the till if they want to be sent a digital receipt rather than a paper one for environmental reasons, will decline to share their email address.
An independent poll of more than 2,100 UK adults by YouGov in January 2021 found that 8% had shopped solely at bricks-and-mortar stores over the previous 90 days. While that was half of the number who’d shopped exclusively online during that period, this finding indicates that a significant number of consumers remain tied to a non-digital world.
The study found that consumers’ inability to interact physically with products was the second-highest barrier, after their unwillingness to pay delivery charges, dissuading them from shopping online: 45% of respondents said this was a deterrent, compared with only 5% citing a lack of internet access. In the medium term, the emergence of tech such as virtual and augmented reality offers a potential solution. But, as businesses look forward and start adopting these new technologies, they also risk widening the gap between the digital natives and the analogue holdouts, further alienating a significant cohort of potential customers.
“At Metro Bank, we see a lot of people who want to use both channels – and there are certain customer experiences that I’d still rather have in person,” Robinson says. Keeping that in mind is crucial, as is not getting carried away by the endless promise of technology.
“In this business, we always start with our customers. What kinds of customers might come through the journeys we offer? Can we put ourselves in their shoes? We need to know how these journeys look from their perspective,” she says, adding that the online and offline experiences offered by the bank ideally offer the same quality. “This is about how organisations stand up their capability and ensure consistency across their different channels.”