Anyone awake and conscious through the last year and a half would have felt that the pandemic has fundamentally changed human behavior in daily life. Some of it knowingly, some unknowingly and unconsciously. Since we, well most of us, are consumers of products and services alike, these behavioral change patterns have created a shift in experiential expectations of us humans and this in turn has changed the way we interact, transact and consume.
More time leads to reflective decision making
For starters, we have more time at hand. This may seem basic, but more time (coupled with the existential nature of changes imposed upon us by the pandemic) leads to more thoughtful, reflective, aided, nuanced and (possibly) astute decision making. Needless to say, this has made the "how" (- essentially the experience -) of a transaction much more important than the "what" ( - product or the service - ) being bought or exchanged.
For example, the reflective working professional with time at hand feels the need to invest in her(him)self. This is an easily addressed ask especially due to the proliferation of online education in lockdown impacted times. The remarkable shift however is in the expectation that this learning will be entertaining thereby making great use of free time. So in a nutshell for an online education provider, remote accessibility of educational content isn't nearly enough anymore; differentiation lies in quality of content and the experience of how it is delivered (with possibly the experience being highest in priority) This is causing online education marketplaces to act more like original content producers with excellence in the experience of imparting education.
In a further twist to this model especially around education and up-skilling, we see democratization of content production in platforms like Skillshare. I have also come across genZ who consider short format indy video content on TikTok as a learning resource more attractive than most accredited learning formats.
Another very interesting example of changing expectations from experience, is around how we tend to do groceries and other daily supply provisioning. What would have been a regular visit to the nearest supermarket evolved into using the online channel for the regular supermarket, and then it further moved to considerations around sustainable and fair-trade or local produce sourcing. This has created a trend of moving towards marketplaces which have the modality of grocery procurement at heart rather than the grocery items themselves. Take a look at Dumpling which positions as "the personal, ethical, and local way to get groceries to your door".
We transact and engage digital-unless
Increasingly, we are digital-unless (irrespective of boomers, millennials, genZ) and most of it manifests as mobile-first or mobile-native. This creates an interesting customer engagement context, given that physical and digital goods and services are all flowing through digital channels. This makes the storefront obsolete and firmly establishes perception as the reality. This was an evolutionary trend till it was accelerated by the pandemic. My mum and dad who are in their late seventies/ early eighties have discovered and are using online essentials shopping via mobile apps. Children in India who have started school in the past couple of years have seen online media as the only educational conduit. Virtual events, earlier mostly limited to conference calls in working teams, have expanded to concerts, conferences, church service, alumni meetups, hack-athons, auctions, pretty much any multiparty interaction for that matter.
The need for digital channel combined with physical logistics enforced and accelerated by the pandemic has seen horizontal marketplaces driving huge growth (and at times consolidation of players. Takeaway.com is a prime example of this. there has however been a consumer preference driven proliferation of vertical marketplaces as well. In the food delivery space Chowbus is a great example which focuses on the cuisine rather than the delivery service. Gooddog is another great example of a vertical marketplace cashing in on a pandemic influenced trend around the need for companionship and pets. It is also evident that the most popular marketplaces are the ones which have caught onto trends early and have read ahead on human behavior and experience expectations especially when impacted by radical life events like the pandemic.
Our digital lives are now more important than ever
Our digital lives have seen a boost. With Digital channels being the only conduit for demand and supply of digital and physical goods and services, there are interesting trends (aided by contemporary technology) emerging. Digital ownership is going mainstream aided by NFTs (non fungible tokens on blockchain enabled platforms).
Consumer to Consumer (C2C) and Direct to consumer proliferation in marketplaces is commonplace. This entails that consumers are increasingly seeing themselves as investors leading to agents or middlemen being removed from the equatio. An interesting case in point for example is Cameo, a marketplace for exchanges between Indy and professional artists and customers. Similarly we have TopShot, where a fan can own whole or part of a digitally available moment of their favorite game ; My neighbourhood friends circle which was hooked onto Amazon for shopping a year ago is now increasingly looking for product and service solutions for daily needs on Facebook marketplace, Wish, eBay, Marktplaats or even Nextdoor. Incidentally this also means new supply sources are reaching the market and demand and supply are meeting in non-traditional informal formats at times away from direct influence of enterprises. This is leading enterprises to increasingly use anthropological resources to reach audiences via community rituals. This trend is not only limited to shopping or commerce but can be seen in examples like Skillshare which proliferates and democratizes non-accredited education through a vocational experience sharing model. Another interesting development is the proliferation of vertical marketplaces, specialized in specific demands arising out of our digital-unless experience expectations.
Our core values influence our consumption behaviors
Customer engagement and buying behavior is significantly impacted by considerations around ethics, sustainability, equality. Brands which operated with an aspirational promise are increasingly pivoting to relatability as the primary trigger for consumers. With brands and brand ambassadors/ influencers being relooked at, through lenses of aspirational as well as relatable, the values lived by every aspect of the brand and how it manifests in customer engagement becomes important. Fashion buying is seeing a movement into slow fashion and transparency and sustainability declarations. Environmental awareness, wastage reduction, are themes that we see extensively across a wide spectrum of enterprises, looking to engage the reflective, considerate and knowledgeable contemporary consumer.
This is widespread, e.g., in energy companies (Shell with their employee experience inclusive carbon neutrality message, Vattenfall's 'humans have more impact than they think' campaign), Automotive manufacturers (VW way to Zero strategy towards carbon neutrality), Fashion brands (Adidas Parley using recovered recycled ocean plastic, Hermes' promise on preserving natural materials, slow fashion SonofaTailor's made to order low waste promise, Asket's waste reduction and transparency promise, Artisanal fashion and durables Archibald's no middlemen artisanal sustainability promise.
Marketplace evolution trend watch:
- Relatable trumps Aspirational leading to C2C proliferation
- Vertical marketplaces capitalize on pandemic impacted behavioral trends
- Digital ownership led by NFT proliferation, is creating unique marketplaces
- Online education marketplace is pivoting to entertainment and content creation
- Community and rituals facilitate commerce and C2C marketplace platforms cutting out the middleman
Related Reading and reference:
- The a16z Marketplace 100: 2021
- Capitalism without Capital: The Rise of the Intangible Economy
- Redefining Shopping for a Post-Pandemic World
- a16z Podcast: All about NFTs
If you want to share thoughts regarding customer experience, marketplaces or any other related subject, please contact our Head of Digital Experience Europe Pradipto Basu.