I always advise reflecting on the prior holiday season. It sets the tone for the current year and ensures retailers make the necessary adjustments.

To guide that reflection, Digital Commerce 360 and Bizrate Insights surveyed 1,023 online shoppers in January 2023. Once again, “more” begins with Amazon.

The real story is often told by what shoppers do more of in the critical holiday season. First and foremost, we begin with buying, and year over year, shoppers gravitated more to Amazon (59%). In general, they also spent more online (36%), and more also meant embracing the mobile website and app (30%). Beyond Amazon, marketplaces continued to garner shopper attention more (27%), and shoppers bought from a wider range of retailers (26%). Lastly, 9% scrolled social media more for shopping purposes.

Shoppers were hyper-aware of economic challenges particularly inflation

With prices top-of-mind, 30% comparison shopped more to ensure they got the best deals. Similarly, 20% tracked promotions more in hopes of getting the best prices.

Ironically, 16% of these same shoppers paid for shipping on their orders more. My feeling was that free shipping just wasn’t available as it had been in the past. With some retailers visibly promoting their price matching like Target, 10% of those surveyed reported that they in fact sought price adjustments more. For those who didn’t have the money or chose not to pay outright, 9% financed their purchases more this year and retailers advertised this payment option to garner participation. And given the global nature of ecommerce, 7% purchased beyond the U.S. even more to save money.

Shoppers were cautious, and inventory was also on their minds as 20% paid greater attention to retailers that had products in-stock. They have enjoyed the same-day delivery option getting products quickly, and 12% embraced it more over the holidays. Additionally, based on retailer warnings, 10% ordered earlier to ensure timely deliveries.

Coming off ignited interest in omnichannel delivery options and its convenience, shopper usage was strong as 22% used buy online, pick up in store (BOPIS). 18% used curbside pickup and, sadly, 8% avoided physical stores more due to crime.

Lastly, 9% embraced a more exciting experience, watched livestreams of products more.

Online shoppers are savvy about finding and taking advantage of promotions

It’s always important to remember that no given promotion is relevant to all shoppers, so the opportunity can be inherently limited.

Four in 10 online shoppers found adequate promotions and said they believe they got their fair share. Meanwhile, 20% unfortunately felt the promotions were not on items that interested them. For the 34% who encountered steep promotions, 22% reported being able to make some purchases while 12% couldn’t capitalize on those offers due to personal circumstances. Unfortunately, 26% of those surveyed said they only encountered limited promotions.

One thing we know for sure is that online shoppers will go to great lengths to track promotions in the interest of saving money. 22% spent some time tracking promotions prior to making purchases. Meanwhile, 13% of survey respondents spent significant time tracking promotions.

Delivery, delays and omnichannel options

Prior to the holiday season, there was a great deal of discussion around deliveries and whether orders would be delayed. Retailers need to pay attention to delivery times, as speed is a distinct advantage in shoppers’ minds.

While 40% of 2022 online deliveries seemed to take about the same time, 30% seemed to take longer than in 2021. In positive news, 26% were actually faster.

Communication about delays is ideal, and retailers should have it in place to alert shoppers to their status. Positively, 18% received notifications from retailers about delays. Retailers have an opportunity to leverage omnichannel options, though many prefer delivery choices. With that in mind, 8% selected BOPIS. We had also feared that this choice might resonate less than during COVID, so it was positive that only 5% did less curbside pickup than in 2021.

Higher prices reduced spending among online shoppers. As such, it will be critical to monitor inflation patterns in the coming year. Retailers will continue to evaluate product pricing in 2023 and will want to understand where incremental spending will come from if high prices remain.

Spending took a big hit, as 42% of online shoppers said they spent less online over the holidays as a result of inflation. 35% spent about the same and, ironically, 23% spent even more, not impeded by the inflation numbers.

Prices and stock drive retailer selection

Next, we delved into the prices and promotion discussion. We wanted to understand how shoppers chose the retailers where they did business over the holidays.

Our findings showed prices (especially free shipping) matter most to retailer selection. Free shipping, which 56% of respondents cited, remains a customer favorite when selecting retailers and likely emanates from their Amazon Prime experience. Following close behind from a price perspective was the 41% who cited fair and competitive prices. Shoppers also appreciate the option to return their purchases for free. 25% of survey respondents noted such a preference. Other price-driven factors included appealing promotions (23%), email offers (17%) and deferred payment options (6%).

For 43% of participants, having products available was a key factor in selecting retailers. Logistically speaking, 18% noted guaranteed delivery times while 9% said they valued express shipping options.

Online shoppers remember past experiences and make future retailer selections accordingly (36%). Shopping fundamentals, from product selection to the perception of fair pricing and appealing promotions, factor into retailer selection as well. Also important to retailer selection: featured products (29%). Meanwhile, exclusive items were much less of a factor at 14%.

From a brand experience and customer service point of view, the following factored into retailer selection.

• Loyalty program member: 22%
• Wish lists: 20%
• Flexible return policies: 18%
• Retailer had good customer service: 16%
• Longer time period to return items post-holiday: 7%
• Social stance, charitable giving and or/sustainability: 4%

Price and logistics-driven conveniences, including free return shopping, resonate with shoppers. That included the ability to return items to a physical store (16%), BOPIS (11%) and curbside pickup (9%)

Returns are a hassle for online shoppers

Returning products remains a factor for online shoppers, and retailers must balance the conveniences they extend and costs they incur. 30% of online shoppers find returns to be a hassle. That likely results in just over half planning to return the same or fewer orders. From a volume perspective, 32% of surveyed shoppers expected to return fewer products, while 23% saw their returns on par with last year. Only 9% believed they would be returning more. Providing better product information will continue to keep return rates lower. Choices in how returns could be made continue to grow.

Respondents expected to use the following means to make such returns:

• Stores like Kohl’s that accept Amazon returns: 13%
• Amazon return centers: 10%
• Services like Happy Returns: 7%

Online channel still sees traction

Online shoppers will continue to embrace online shopping at the expense of store shopping if the user experience and inventory levels can be maintained. Of course, some online shoppers will continue to gravitate to the store for specialized services.

Three in four online shoppers intend to shop about the same (46%) or less (32%) in physical stores in 2023. With only 22% shopping more in stores, the web is likely to be the beneficiary.

Online shoppers’ 2023 wish list is long

Perhaps the most important question of the survey is what improvements shoppers would like to see from retailers in 2023. Online shoppers are hoping for faster delivery and more in-stock products, complete with a price match reassurance.

Balancing supply chain constraints and consumer inventory demands will be a challenge in 2023. Shopper desires start with more inventory in stock (32%). Equal in importance was the online shopper’s desire for faster delivery (32%). BOPIS at 12% and improving curbside pickup at 5% rounded out the logistics.

With inflation still hovering, policies like price matching and extended return polices will be favorable among online shoppers. More price matching and extended return policies (27%) speaks to that concern as well.

Attention to customer service among retailers is always a factor, with better customer service important to 13% and live chat support called out at 11%.

Retailers must be vigilant in optimizing the user experience. That starts with a simpler checkout (21%) and better product information.

Personalization is welcome as 20% noted liking promotions tailored to their preferences. It’s important to remember that tracking and privacy efforts must be controlled, as 18% prefer less tracking of website activity/advertising.

Additional customer experience elements — at 17% of those surveyed — include:

• Better product information/robust images
• Improved search results
• More special promotional codes via social

Others in double digits include easier shopping on mobile devices (15%) and faster website speeds (11%).

For better for worse, one in four shoppers expect to shop the same. One in five will be shopping more online, and this bodes well for growth. It’s still important to pay attention to the 10% who intended to shop more in physical stores. Others that were particularly interesting include the role of prices and promotions, a direct response to 2022’s higher prices. 11% of shoppers believe they would have less spending overall, and many of the answers were tied to personal circumstances. Some shoppers also want to getting smarter about their shopping, which can include buying early among other options.

2023 will be an interesting year. It’s too early to tell about inflation and how prices might pan out. Retailers should spend their time focusing on what they can control. They must continue to get the fundamentals right. That includes product, ensuring stock levels are adequate and embracing category-centric merchandising. And, of course, timely delivery will go a long ways toward customer satisfaction.

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