New report examines consumer shopping, gifting and payment preferences across eight countries
PLEASANTON, Calif. – Branded payments provider Blackhawk Network released its 2020 Multinational BrandedPay™ report revealing a surge in digital wallet adoption with 88% of surveyed shoppers in eight markets using a digital wallet of some kind. The research also found that more than half of consumers surveyed have now purchased or received a digital gift card, which unlike physical gift cards, are equally as likely to be purchased for self-use as they are to be gifted to someone else. The report examines attitudes and behaviors around shopping, payments and gifts, including research conducted both before the peak impact of the global pandemic and supplemental data2 gathered as many countries began phased re-openings.
“Over the last few months, we’ve witnessed a rapid shift to digital when it comes to both consumer demand and the need for retailers to adapt to meet customers where and how they are shopping,” said Theresa McEndree, vice president of marketing at Blackhawk Network. “Initially, our research captured the evolving preferences of consumers in the U.S., U.K. and several other countries. As we began to approach the next phase of the COVID crisis, it became apparent that the consumer demand for digital and the glaring gaps we had identified between the digital and physical marketplace were not only still relevant, but largely accelerated or made more prominent. Now more than ever, the brands and retailers that will survive and ultimately thrive are those quickly adapting and actively looking for ways to overcome new challenges by seamlessly engaging customers across the channels they find most valuable.”
Based on responses from more than 12,000 consumers from eight countries around the world, the data was examined to identify the following trends:
Digital wallet adoption has taken off
Eighty-eight percent of shoppers surveyed across the eight countries use a digital wallet of some kind. In the U.S., before the pandemic hit, less than 38% of Americans surveyed said they were using digital wallets to make purchases more or as often as the year before. As the economy began to reopen, that number has jumped to 55%. However, most surveyed consumers who aren’t currently using a digital wallet aren’t interested in starting. Across the eight markets, among those that don’t use a digital wallet, only 29% surveyed show any interest, with only 6% saying they are very interested.
Barriers to adoption: According to surveyed consumers, reservations about using digital wallets boil down to lack of knowledge about how they work, how secure they are, what the benefits are and which one would best suit their needs.
Payment priorities: When paying, online or in-store security (94%), safety (94%), reliability (93%), ease-of-use (93%) and no fees (93%) are the most important factors considered by shoppers surveyed across eight markets.
Digital gift cards gain on plastic with boost from self-use
More than half (52%) of shoppers surveyed have purchased or received a digital gift card. However, unlike physical gift cards, digital gift cards are just as equally likely to be purchased for self-use as they are to be gifted to someone else.
Surveyed consumers who’ve purchased digital gift cards for self-use do so to treat themselves, make an online purchase or take advantage of a discount or promotion.
Surveyed consumers who’ve purchased digital gift cards for others do so because the gift can be emailed immediately, the recipient can make online purchases and it’s a faster—and easier—purchase to make vs. an in-store purchase.
Online shopping surpasses in-store
More than half (53%) of shoppers surveyed across eight markets report shopping more frequently online than they do in-store, and regularly shop from mobile devices. Four-in-ten shoppers surveyed are using their mobile phones and/or a mobile app to shop online. Compared to last year, 39% report having made more online purchases this year, with just 27% reporting they’ve made more in-store purchases. Fewer than two in ten shoppers surveyed report cutting down on either type of purchase.
The rise of retailer apps: 61% currently make purchases within retailer apps. In the U.S., before the pandemic, just 21% of U.S. consumers surveyed were making purchases in retailer apps more often than last year. After the first phase of the COVID crisis, nearly half of Americans surveyed are doing so more often, and the number of Americans surveyed who had never used a retailer’s app fell sharply from 32% to just 13%.
Navigating Changes from COVID-19
The world is only just beginning to realize what shifts in shopping behavior and preferences will be made permanent after the pandemic. While more than half (55%) of U.S. consumers surveyed feel safe shopping at physical retail locations, 44% report being unlikely to return to their normal shopping behavior even as stores start to reopen.
In the U.S., 78% of surveyed consumers expect permanent changes to shopping experiences as a result of COVID-19. The sentiment is similar in the U.K. with 75% of consumers expecting permanent change.
In both the U.S. and the U.K., three in five surveyed consumers report that masks, gloves and other safety measures make them more likely to shop online than in-store.
Nearly 70% of U.S. consumers surveyed are now more likely to shop online with retailers that offer curbside pick-up options.
Top payment trends by country
U.S.: The Americans surveyed are among the world’s most engaged users of both physical and digital gift cards. More than any other country, surveyed Americans are most likely to have purchased or received physical and digital gift cards. Gift Card Malls™ originated in the U.S. and have since become ubiquitous in grocery stores and mass merchandiser retail. More than 75% of Americans surveyed have an opportunity to pass a gift card display rack every week.
Canada: The Canadians surveyed report much lower engagement in digital channels than the rest of the countries surveyed. Of the eight countries, they are among the least likely to say they shop online more often than in-store, and their attachment to digital gift cards is similarly low.
Mexico: The Mexicans surveyed are among the least likely of the eight countries to have digital wallets. However, Mexican consumers surveyed are the most likely to believe in the perks, convenience and savings that come with digital wallets.
Brazil: More than 95% of Brazilian consumers surveyed have at least one digital wallet, and they use them regularly for purchases more than any other group surveyed.
U.K.: For daily shopping, the British consumers surveyed are less likely than any other group among the eight countries to use debit cards and credit cards. More than 88% of British shoppers surveyed still regularly rely on cash, and while about 90% of British shoppers surveyed have a digital wallet, they are seldom used.
Germany: Though the Germans surveyed are the second-most likely of the eight countries to use a digital wallet, individual digital wallet options have very low engagement rates. A large majority of German shoppers surveyed use some form of digital wallet but stick to the one they like and avoid others.
Netherlands: The Dutch shoppers surveyed are some of the most frequent digital wallet users, paying with them daily at even higher rates than Brazilians.
Australia: The Australians surveyed stand out by being the least engaged in technology and mobile shopping. They are least likely among the eight countries to say they’re shopping online more than in-person and more than half of Australians surveyed don’t use a digital wallet of any kind—well below the surveyed average.
Blackhawk Network works with more than 1,000 brands and card partners, is in more than 200,000 retail locations in 28 countries, including a presence in EMEA and APAC. Blackhawk Network connects with more than 300 million shoppers worldwide each week. For more global insights and in-depth analysis by country, download the full report, “BrandedPay: How People and Brands Connect Through Payments” here.
About Blackhawk Network
Blackhawk Network delivers branded payment solutions through the prepaid products, technologies and network that connect brands and people. We collaborate with our partners to innovate, translating market trends in branded payments to increase reach, loyalty and revenue. Serving 28 countries, we reliably execute security-minded solutions worldwide. Join us as we shape the future of global branded payments. Learn more at blackhawknetwork.com.