PayPal’s e-Commerce Index¹ explores the ever-evolving e-commerce landscape, revealing how new ways to shop are creating new opportunities to sell. With 72 per cent of Britons opting to shop online every week, we look at the rapid changes taking place in e-commerce and what retailers can do to keep pace with the latest tech trends and changes in how consumers shop online.
In the UK, the use of virtual spaces and the metaverse is growing, with almost a quarter of Brits saying they have at some point (24%) spent time in one, jumping to two-fifths amongst Gen Z (42%). However, with only 1 in 10 believing they will become important channels for shopping in the future, British consumers remain to be convinced.
When looking at how consumers are using virtual spaces and the Metaverse, top activities include virtual browsing (40%), education and training (39%), online gaming (39%), virtual shopping (39%) and arts and live entertainment (39%). Whilst still in its infancy, one in ten consumers (11%) already believe that in the future, more engagement will happen in virtual spaces than in the real world. And we’re already seeing demand, with one in ten UK consumers wanting their favourite store to exist within a virtual environment (9%), and to be able to purchase physical products within a virtual space (9%).
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Companies both big and small have already started their metaverse journey. Household names have all ventured into the metaverse in some form or another. And besides digital investments accruing value over time for investors, the benefits of owning digital property can be numerous. One of the main benefits of brand presence in the metaverse is the ability to participate in virtual events – in 2022, Decentraland collaborated with curated NFT marketplace UNXD to run the Metaverse Fashion Week in late March featuring Selfridges, Dolce & Gabbana and Tommy Hilfiger. The event replicated fashion weeks from the physical world – such as New York Fashion Week and Paris Fashion Week – with immersive spaces, installations and runway shows for participants to enjoy.2
But with new technologies come new risks, and a quarter (25%) of Brits are worried about their security and safety in trading digital assets including cryptocurrencies and NFTs. Whilst a fifth (21%) of UK consumers say they have owned or currently own cryptocurrency, with 13 per cent interested in learning more, UK consumers lag their European counterparts, with consumers in Greece (29%) and Israel (31%) twice as likely to say the same. And we see a similar attitude towards NFTs. Currently a niche investment for UK consumers, a higher number of Brits say they don’t trust investing in NFTs (28%) or are concerned about the safety and security when trading them (23%).
As is the case with cryptocurrencies, UK consumers are less likely to own or be interested in learning more about NFTs than consumers in other European countries, with Greek consumers the most likely to own NFTs (14%) and those in Belgium and France leading the way in wanting to learn more about them (31% and 25% respectively).
As adoption of blockchain and virtual technologies grow, PayPal’s E-Commerce Index highlights the need for businesses to consider how to use these technologies to not only communicate with their customers, but to sell goods and services too. However, for many businesses, for at least the immediate future, these developments are perhaps ‘something-to-watch’ rather than something to immediately act upon. And whilst the UK lags Europe in metaverse participation, businesses could instead look to Europe as a test bed on the latest developments.
To find out more about how PayPal can help businesses benefit from the latest trends in ecommerce, read the full PayPal E-Commerce Index Report here
¹PayPal’s E-Commerce Index is based on a study conducted by ACA Research with n=15,221* consumers and n=4,604 businesses in July 2022. It contains general observations about trends in e-Commerce, social commerce, Buy Now Pay Later and cross border as well as involving cryptocurrency, NFTs and the metaverse. The study does not take into account the objectives, situation or needs of any specific business or individual. The statistics set out in the article above are taken from PayPal’s E-Commerce Index, unless otherwise stated within.
²“The Metaverse: Real Estate of the future?“, 365 Retail, July 2022.
