As today’s consumers are increasingly demanding, we are defining the concept of the 5 C’s for consumer brands – Convenience, Cost of Living, Care, Circular Economy and Community. Today, we explore how by focussing on the ‘convenience’ of their offering, brands can win over today’s consumers.
Essentially we see convenience as a factor of both time and effort, and in this fast-paced world time is money. In a survey conducted by Forbes, 70% of customers would pay more if they knew they would receive a convenient experience. Large corporations have made big moves investing in customer convenience including the likes of next day delivery subscriptions, no scan self checkouts and even just walk out technology. Whilst many startups have also succeeded by innovatively addressing customer pain points; here we consider 4 of the demands of the modern consumer…
‘I want it, I want it delivered’
In the last decade we have seen a surge in products delivered to the home, and then the pandemic accelerated this further. According to the 2020 ARTS release, e-commerce sales increased by 43% in 2020, the first year of the pandemic. Customers demanded delivery for products traditionally purchased online, for example, searches for ‘plant delivery’ spiked to 6x what they were before the pandemic in May 2020.
Consumers have now got used to being able to get anything they want delivered, consumers enjoy the ease of it and are willing to pay for it. If you have ever taken 2 public buses across London carrying a desk you will be able to relate.
Companies have become innovative with their products to cater for this, and are winning over customers for it. The mattress is vacuum packed into a transportable box to enable easy courier delivery (whilst also offering 0% finance and a 200-night trial), Snug is the ‘Sofa in a box’ company which allows no tools assembly and also a 100-day trial whilst Bloom and Wild flowers can be easily delivered through the post box and bloom at home.
‘I’ve seen it, I want it’
You’re scrolling through Instagram and up comes that dress you have been thinking about or a multiway frying pan that looks like it will solve all of your problems. As a consumer we click, purchase and don’t think much more about it - but what is this clever and easy method used by retailers? Social commerce - in simple terms - E-commerce x social media. As stated by Forbes; shopping has always been a social experience, but it's no longer contained to malls and shopping centers. According to Accenture, by 2025 alone, social shopping is set to become a $1.2 trillion channel with 98% of customers planning to utilise social purchasing to make at least one purchase this year (Sprout Social).
Unlike traditional e-commerce, social commerce enables customers to complete their purchases directly within the social media platform. The experience is smooth and effortless (reducing the chance of abandonment); with just a quick tap, they can resume scrolling through their social feed. We will further touch on the effect of social media in our Community blog.
‘I want it, I want it again and again’
We have all been there when you go to the toilet and realise you have run out of toilet paper! Along with the immediate annoyance there is also the annoyance that you have to go back out and waste time and effort going to buy some. This same pain occurs with washing tablets, coffee pods, pet food…the list goes on.
Enter - the subscription!
Forbes predicted the Global subscription e-commerce market to reach $904.2 billion by 2026 from $72.91 billion in 2021; that’s over 12x growth. Many forward-thinking brands now have a subscription option; Wild deodorant, Who gives a crap! toilet roll and Estrid razor have exploded onto the scene in recent years, all gaining significant funding in the last few years. Whilst examples such as these are not only providing their customers with convenience and value but they are also focusing on sustainable products and ethical practices which has helped foster dedicated communities around the brand - demonstrating the power of the 5 pillars.
Convenience and the cost of living… ‘I want it, I want it now, but can I afford it?’
As we will explore in our next cost of living blog, as consumers worldwide are ‘feeling the pinch’ their desire and ability to pay a premium for convenience may waver. In 2021 we saw the rapid rise of Q-commerce with many startups in the space gaining strong investment. Getir was valued at $12bn in March 2022 in their Series E; Gorillas was valued at $2.1bn in October 2021 in their Series C, and Zapp has raised over $300m.
IGD estimates an average q-commerce basket is 18% more expensive than a convenience store, whilst 59% of shoppers who use q-commerce apps are doing so less frequently (according to a poll by NTT Data). As cost pressures rise is this a level of convenience that consumers can’t afford to make a habit of? Given the wavering demand, fragile profit structure and market sentiment, speedy grocery companies around Europe have struggled to maintain their 2021/22 lofty valuations. Getir acquired its rival Gorillas for around a third of its peak valuation in Dec-22 and in its new $500m funding round in Sept-23 valuation reduced by 4x.
The dynamics of the trade off between cost and convenience are changing as financial pressures become more apparent and will vary from person to person. Companies that can successfully implement a convenient solution without significantly inflating their costs are well positioned to succeed with the modern consumer: demanding yet budget-conscious.
In our next blog post we delve into the rising cost of living and how addressing this pressure can shape a brand’s relationship with consumers…
