UK e-commerce sales bolstered by physical touchpoints in 2023: Report

Physical storefronts for browsing and returns have long been integral to the omnichannel approach. However, the report ventures further, identifying the burgeoning role of social media and artificial intelligence (AI) in reshaping the retail landscape. For younger consumers, particularly those belonging to Gen Z and Millennials, social media platforms like TikTok and Instagram have surpassed retailer websites as the primary channels for product discovery. A significant 40 per cent of digital natives under 45 years of age turn to social media for shopping inspiration and research, a notable contrast to the 35 per cent who prefer traditional retail websites.

The research also forecasts a promising future for AI in retail, with 30 per cent of UK consumers acknowledging its value in enhancing order and delivery updates, and 27 per cent seeing its potential to simplify returns and exchanges. Despite some reservations, these findings signal a growing receptiveness towards AI's role in streamlining shopping experiences, provided retailers maintain transparency and responsible use to foster consumer trust, as per the report.

Amidst these advancements, cost concerns, particularly regarding delivery fees, remain paramount among UK shoppers. The study found that 42 per cent of consumers consider delivery costs as their most crucial consideration when shopping online. High shipping fees have deterred 65 per cent of UK consumers from patronising certain brands, with half of the respondents unwilling to pay for premium delivery services. This underscores the importance of balancing cost efficiency with customer satisfaction for retailers.

Furthermore, the report sheds light on the evolving landscape of product returns, with 30 per cent of consumers expressing a preference for in-store returns and 25 per cent for pick-up/drop-off locations. Gen Z consumers are highlighted as the most frequent returners of apparel purchases, with an average return rate of 19 per cent. Although 67 per cent of consumers expect free returns, a 13 per cent decline in this expectation suggests a growing awareness of the costs involved. Notably, half of the Gen Z demographic is willing to pay for expedited and effortless returns, indicating a shift in consumer attitudes towards returns policies.

As the retail sector moves into 2024, surveyed merchants have voiced concerns over rising overheads, subdued customer demand, and fierce competition. These challenges underscore the necessity for brands to craft seamless customer journeys that effectively integrate online and offline experiences to stay ahead.

"The £52 billion figure reveals a fascinating evolution in consumer behaviour, and a major opportunity for brands. We're moving beyond simply 'online' or 'offline' shopping. Today's consumers seamlessly blend physical touchpoints, like stores, with social media discovery. They’re even showing openness to new innovations like AI for streamlining the most tedious parts of the shopping process, like delivery and returns,” said Al Ko, CEO of Auctane.

Fibre2Fashion News Desk (DP)