Online Shopping
Introduction
Online shopping has become so accessible and easy to use that we now shop without thinking. Let's take a look at the stakeholders benefitted from online shopping, how it affects their behaviors, and what is the relationship intertwined between different sectors.
Stakeholders
Retailers
Young Adults
Parents
Social Media Companies
Influencers
Impact on Stakeholders
Young Adults
Positive Impact
Young adults find online shopping as an exhilarating, convenient, and even therapeutic experience. It allows them to have a more efficient routine since they do not have to plan their shopping trips. Lastly, young adults can feel included when they kill time while browsing for trendier options.
Negative Impact
However, they are prone to shop without considering actual needs, which means they are spending more money and wasting working products. When companies aren't transparent enough, they can fall prey of fast fashion brands.
At an emotional level, they become dependent of the momentary excitement that retail therapy brings. The urge to stay updated with trends can lead them to feel empty long-term and continue the cycle of overconsumption.
Retailers
Positive Impact
Retailers can customers through the use of digital ads.
They also gain better data sources on buyers, and benefit from the brand experience and value they provide to audiences.
Negative Impact
By contrast, when retailers don't prioritize online shopping platforms, they end up losing customers. Their customers doubt and feel less compelled to purchase something if their platforms do not show physical products.
Another downside from online shopping is that retailers experience a decrease of physical customers due to the shift customers are making to online platforms.
Retailers also have to constantly keep up and differentiate from fast fashion companies, as they sell low quality goods for crazy affordable prices. In some cases, they might even experience higher returns than sales.
Social Media Companies
Positive Impact
Online shopping experiences give social media platforms new financial opportunities through the form of partnerships with brands. The ads placed by these companies allow social media platforms to profit from the subscribers' engagement.
Negative Impact
On the flip side, online shopping might divert users from social media platforms. Shopping ads can backfire if people don't want to see them.
Parents
Positive Impact
Similar to young adults, online shopping makes parents' routines easy. It allows them to save time and effort as they can easily check pricing variations on several platforms before making a purchase.
This type of experience helps them find the right products they would like to purchase for themselves and others.
Negative Impact
By contrast, the accessibility online shopping provides stimulates them to spend more money and accumulate products. This type of habit could influence children's perspective of money and lead to more waste accumulation.
Relationship Analysis
To further dive into understanding problem behaviors around online shopping, we researched and mapped the relationships between problem areas and individuals, business, society, and the planet. By doing so, we found the following tensions.
Mental Health and Addiction
FOMO Marketing
Businesses have taken a marketing approach that leaves individuals feeling a need to purchase products, even when they don't have that thought in mind. This is done with terms like 'last time' or 'final sale', that forces individuals to feel rushed or as if they were about to lose something important.
Retail Therapy
Some people are prone to use retail therapy as a coping mechanism against boredom, feeling stressed or lonely. While this alleviates their feelings short-term, it can lead to bad spending habits and financial decisions. Shopping addiction has been compared to other behavioral disorders like gambling and cybersex.
Consumption Behaviors
Paradox of Choice
Even though people enjoy the ability to choose from several products to browse and compare, it also overwhelms them and makes them indecisive and deviate from what they wanted to purchase in the first place.
Returns
The returning process has been simplified, which allows people to enjoy the conveniency of online shopping.
However, retailers' returns are becoming increasingly unaffordable for businesses, as e-commerce return rates have spiked 95% in the last 5 years.
Browsing Data
In order to browse social media or online platforms, individuals need to give up on their privacy so these platforms can track their next moves. They want to buy, but also don't want to be constantly tracked.
Fast Fashion
Fast fashion plays a prominent role in affecting our environment, as their products are manufactured irresponsibly. With this pervasive mindset, consumers are found feeling responsible to take action against it.
However, consumers are constantly found at crossroads, choosing between being sustainable or chasing the newest trends.
Window Shopping
Although it takes shapes digitally, individuals 'collect' unnecessary products in their shopping carts. This type of habit can evolve to a compulsive tendency, where they continue browsing without purchasing and feel guilty for not being able to afford the products.
Culture and Society
Amazon
Amazon has paved the road for online shopping, with free shipping and fast deliveries.
By contrast, other similar platforms have been forced to change their procurement process and spend more money to keep up. If they choose not to, they risk losing customers to Amazon. Therefore, as society finds Amazon affordable and easy to use, it's creating less opportunities for smaller businesses to compete.
Social Media
Businesses benefit from social media's convenient opportunity to reach wide audiences. But, it takes away the importance of their personal online websites, where consumers are more likely to make a purchase.
COVID-19
As COVID 19 affects the economy, businesses are trying to keep their revenue afloat. However, they are also struggling to maintain their staff safe and deliver packages to customers.
Areas of Improvement
If we are to shift our trajectory to healthier shopping behaviors, we have to begin by focusing on what the users actually need, and stop thinking mainly of personal financial gains. Then, social media platforms and companies selling goods need to start evaluating their impact on the global population and small businesses. They need to find balance on how data is gathered and used, as well. Otherwise, social media platforms and retailers might see a decrease in audiences in the future.