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Sep 1, 2022
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DTC beats marketplaces for young cross-border shoppers - report

Published
Sep 1, 2022

Marketplaces may seem to rule the roost in retail these days, but new research claims that Millennial and Gen Z shoppers actually prefer buying directly from e-commerce brands rather than big marketplace platforms when shopping across borders.


Photo: Pixabay/Public domain



Direct-to-consumer (DTC) e-commerce solution provider ESW surveyed more than 14,000 consumers in 14 countries and found that 60% of Gen Z and 63% of Millennials are happier buying direct when shopping internationally.

Why are they so fond of DTC? Some 73% of Millennials and 69% of Gen Z shoppers surveyed believe shopping that way gives them a more personalised experience, with offers and promotions targeted at their preferences. Many older shoppers seem to agree as well, albeit not in such large numbers (63% of Gen X and 50% of Baby Boomers).

It’s all important for anyone selling to international customers given that Gen Z (51%) and Millennials (50%) are the two demographics most likely to shop cross-border. And Millennials retain their position as the highest-volume purchasers with 17% making 11+ international purchases in a year. They’re followed closely by Gen Z (15%) and are some distance ahead of Gen X (7%) and Baby Boomers (5%).

Demographically, the countries with the highest numbers of cross-border shoppers — UAE (66%), China (60%) and South Korea (57%) — also have the highest number of younger shoppers, which is indicative of the latent purchasing potential of Gen Z shoppers.  

“For the third year in a row our data has shown the younger the consumer, the more likely it is that they shop cross-border, making international e-commerce strategy an absolute necessity for retailers and brands targeting these cohorts,” said Natashia Redfern, ESW’s Director of Sales.

“Additionally, younger consumers’ shopping preferences indicate that retailers and brands must adopt a robust DTC e-commerce and content strategy to remain both relevant and competitive in the future.”

TRUST AND SOCIAL MEDIA

Other findings include that Gen Z and Millennial shoppers have a greater degree of trust for online retailers located outside of their home country, about 30% higher than Gen X and two times that of Baby Boomers.  

And while social media remains the dominant channel for product discovery, in-store ranks is third, highlighting the ongoing importance of multichannel capabilities. 

Meanwhile, on average Gen Z and Millennial consumers use three social media platforms for product discovery, falling to two for Gen X shoppers and one for Baby Boomers. The data also reveals a direct correlation between the number of social channels used and the number of times consumers purchased online. Respondents who make more than 11 online purchases annually access on average three social media channels, while those making fewer than 10 purchases annually are active on two social channels. 

Among younger Gen Z consumers, the top three social media platforms for product discovery are Instagram (52%), YouTube (51%), and TikTok (43%). Facebook is less important to Gen Z (34%). Millennials’ top three social media channels are YouTube (46%), Facebook (45%), and Instagram (44%). TikTok is less important to them (32%).

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