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REPORT
The State of Conversational Commerce in 2022
Introduction
Commerce has become a conversation
Many things have changed over the last two years: how we gather, how we plan, and how we communicate today are, in several ways, unrecognizable to how they looked before 2020.
Like most major cultural shifts, these changes have trickled down to many parts of our lives, and shopping is no exception. How we live and how we shop both continue to evolve, with artifacts from each stage of this transformation informing the next.
We wanted to better understand how consumers’ ideas about—and approaches towards—interacting with brands have changed over the last two years, so we went straight to the source. This report contains survey responses from more than 5,000 US consumers, shedding light on how they shop, which brands they’re loyal to, when they prefer to go in-store, and more.
Before we get into specifics, let’s point out the obvious: conversational commerce is catching on like never before. More consumers than ever are interacting with brands via text messaging, with 81.2% of those surveyed reporting that they’re opted in to at least one brand’s text message marketing program. This is a marked increase (26.1%) from our last survey, where only 55.9% said they had subscribed by the end of 2020.
How many brands’ SMS marketing programs do you subscribe to?
"We knew almost straight away that SMS is probably one of the most effective channels in terms of click-through rates and conversion rates. We found that customers who were signing up to get text messages were our most loyal customers who wanted to hear from us... We’re really focused on taking care of this customer base and driving incremental revenue from our text messaging channel.”
And not only are consumers who opt into text message marketing more engaged, they’re also more likely to make a purchase. 63% of respondents who subscribe to at least one brand’s text marketing program reported having made a purchase from a text message within the last three months.
When was the last time you clicked the link in a brand’s text message to purchase something?
Note: Based on responses from those who said they subscribed to at least one brand’s SMS marketing program
This indicates that consumers are more likely to be engaged with a brand if they’re opted in to receive texts. When we asked consumers why interacting with brands via texts positively impacts their shopping experience, their responses confirmed this:
How does interacting with a brand via text messaging positively improve your shopping experience?
Note: Based on responses from those who said they subscribed to at least one brand’s SMS marketing program; the percentage of respondents who ranked this answer in their top 3 reasons
From these responses, personalization and ease emerged as key themes. Consumers let the brands they love into their close circle of text messaging contacts in exchange for an elevated experience, whether that means having first access to a great deal or being alerted when their favorite brand has something relevant to them individually.
"SMS marketing has driven tremendous growth and repeat purchases. The number of people coming back for their third, fourth, and fifth-plus purchases has significantly grown. Subscribers who have made five or more purchases now make up nearly 10% of our repeat purchases. We’re impressed by the success of this channel, and excited to see where we can take it."
It’s undeniable: we’ve entered the age of conversational commerce. For consumers, it’s not enough to get what they need when they need it. They’re also craving real responses from real people. Let’s look at how our respondents ranked their expectations when communicating with brands:
Rank your top 3 expectations when communicating with a brand
Note: the percentage of respondents who ranked this answer in their top 3 reasons
SMS marketing checks every single one of these boxes, and the message from consumers is clear: in an age when we’re relying on our phones to stay in touch, brands are very much a part of this increase in two-way communication.
PART ONE
For consumers, the definition of convenience has evolved
When brick-and-mortar businesses temporarily paused in-store shopping in early 2020, consumers were quick to adopt new ways of getting what they needed. Online shopping skyrocketed as people put a premium on contactless experiences.
Pretty quickly, however, consumers realized that convenience meant more than just hitting the “add to cart” option. Being able to have meaningful interactions with real people was an unspoken, but vital, part of the physical shopping experience; the idea that your shopping experience was being personalized to fit your needs was a desire still retained by consumers. Convenience didn’t just mean finding an item and having it arrive ASAP; it meant reducing overall friction in the path to purchase.
Let’s take a look at our survey responses to illustrate this point. Of the consumers we surveyed, 41% reported that they shop online over six times a month. This is much more than an occasional habit. It’s the norm, and e-commerce is as strong a channel as ever.
How often do you shop online?
“Last year, over 80% of our site traffic came from mobile. Our customer is on her phone at all times, and it’s how she browses our site. Out of all of our channels, personalized text messaging has driven our highest conversion rates almost every month.”
There’s no doubt that people still love to shop online. But some interesting themes took hold when we asked our respondents to elaborate on what keeps them coming back to online shopping. Two answers emerged above the rest as frontrunners:
Rank the top 3 influences on your decision to buy when shopping online
Note: the percentage of respondents who ranked this answer in their top 3 reasons
Fast shipping remains the number one answer, but it’s followed closely by “convenience/ease of payment.” So it’s not just that consumers want to get things quickly. They also want to get them in a way that feels effortless and matches up to their expectations and needs.
A recent Kearney Consumer Institute survey found that consumers define convenience according to three principles: access (getting what they want easily), interface (having a simple, intuitive, frictionless buying experience), and expectations (the item in question meeting the consumer’s demands). In other words, how consumers frame the idea of convenience has both expanded in scope and become more personal.
Some people feel inconvenienced when they have to wait a long time for a package to arrive. Others feel slighted when a product page doesn’t have enough reviews or product details, or when the item that arrives is different from what they had in mind.
It’s not difficult to see how conversational commerce provides a much-needed bridge that delivers all three pillars of convenience to consumers. Friction is removed when consumers can have conversations with real people to get answers to their questions in real time. Expectations are met (and often exceeded) when consumers know what to anticipate. And of course, the more information a consumer is able to harness—often in the form of conversation with a representative from the brand—the more realistic their expectations will be.
The main takeaway here is that “convenience is in the eye of the beholder.” Businesses need to understand which aspects of convenience matter most to their customers and meet them there.
“Our customers are extremely surprised when we reply back [to their text message] so quickly. They're having this real-time conversation as if we're their close friend. You don’t get that with any other platform. Having that level of high-touch engagement is massive when it leads to a conversion, in addition to strengthening our community.”
PART TWO
Hybrid shopping is here to stay
Another lightbulb went off for many consumers the first time they found themselves shopping in-store after months away: they missed it. Or rather, they missed having the option to blend the in-store and online aspects of their shopping experience.
This phenomenon is known as hybrid shopping, or the use of both in-store and online elements in a consumer’s buying journey. You’ve probably engaged in hybrid shopping more than a few times yourself: think of the times you’ve perused a store’s Instagram page before visiting, or checked out styles online before going in-store to try some clothes on, only to go back home and ultimately make your purchase online.
A number of new hybrid shopping touchpoints have emerged over the last few years. For example, buy online, pick up in store (BOPIS) became much more common in 2020 as a safer, contactless way to shop, and still remains a popular option today for its convenience.
For our survey respondents, hybrid shopping was a popular behavior, with 89% of them reporting that they participate in it at least some of the time.
How often do you participate in hybrid shopping?
How often do you participate in hybrid shopping?
The majority of respondents also told us that seeing an item in-person before they decide to buy it is either “somewhat” or “very” important:
How important is it that you see an item in-person before you buy it?
How important is it that you see an item in-person before you buy it?
When we asked respondents why they might want to see something in person first, we saw a number of understandable reasons, from wanting to see how an item of clothing fits to needing more information for big purchases like furniture, appliances, or special occasions (think engagement rings). Other respondents noted that the less familiar they are with a brand, the more likely they’d want to check out an item in-store first. For brands, it’s important to consider how to replicate these experiences and address these concerns—using unboxing videos or tutorials, virtual reality, style/size/fit finder quizzes, and more—to make the online shopping experience even more seamless.
When we asked consumers when they were most likely to get in touch with a brand, we see why hybrid shopping has gained such a foothold.
When are you most likely to contact a brand?
Let’s break these answers down: 30% of respondents said they were most likely to contact a brand in one of two instances: when deciding which product to buy or if they had a question about size, material, or fit. Sound familiar?
It seems that the pull of hybrid shopping is about more than just being in physical proximity to a product (though that certainly accounts for part of it). It’s about access to information and getting assistance with decision-making. In other words, people want proof. Whether that’s social proof (reading reviews), seeing an item in person, or asking a sales associate their opinion, consumers just want to be sure that what they’re buying will be great.
Brands that are paying attention have clued into the fact that the so-called traditional act of clienteling—that is, retail workers establishing long-term, personal relationships with their customers—doesn’t have to be limited to the physical world. It’s an option, but it’s not the only one. We’re in the midst of the evolution of clienteling, where brands can put the concierge-like availability and helpfulness of an in-store sales associate into the consumer’s phone via SMS marketing without it being overwhelming.
“I genuinely think meeting our customers where they want to communicate with us is the most important thing. The fact that we're able to answer a customer through this channel [SMS] that they prefer is just priceless.”
You may be sensing an emerging trend here. Just as there’s no one way to define convenience, “hybrid shopping” can look completely different from one person to the next. Giving consumers the option to take the experience of hybrid shopping into their own hands is what’s proving to be valuable. Whether it’s attention or autonomy that a consumer craves, providing many touchpoints for consumers to engage with a brand is the ticket, whether that’s in-person or online.
PART Three
Loyalty has leveled up
Recent changes in privacy regulations have led to a number of major shifts in how businesses collect consumer data. For the uninitiated, third-party data is that which is collected and managed by organizations other than the one marketing to customers.
Privacy laws and changing consumer sentiments have seen the historical ubiquity of third-party data collection become de-emphasized in the wake of alternate options, like first- and zero-party data collection.
First-party data can be defined as data that’s collected from consumers passively. That is, no third party is involved, but everything collected is inferred from consumer activity, whether it’s from site analytics, CRM, social media behavior, or SMS engagement.
Zero-party data, on the other hand, is much more active on the consumer’s part. In a zero-party data exchange, a consumer explicitly shares their preferences in exchange for something of value. In fact, 86% of consumers will trade personal and preference data with a brand in exchange for early or exclusive access. Furthermore, 55% of consumers will trade personal and preference data to feel part of a brand’s community.
If these stats are setting off the loyalty bells in your marketing brain, you’re not alone. Of course, loyalty programs are nothing new. Of the consumers surveyed, 85.9% of them confirmed being opted in to at least one VIP or loyalty program.
How many brands’ VIP/loyalty programs are you a part of?
When we asked respondents why they signed up for said loyalty programs, the answers were very much in line with the building blocks of zero-party data:
Rank the top 3 reasons that made you join a brand’s loyalty program
Note: Based on responses from those who said they are part of at least one brand’s VIP/loyalty program; the percentage of respondents who ranked this answer in their top 3 reasons
Rank the top 3 reasons that made you join a brand’s loyalty program
Note: Based on responses from those who said they are part of at least one brand’s VIP/loyalty program; the percentage of respondents who ranked this answer in their top 3 reasons
To consumers, the benefits are clear: they’re happy to hand data over to the brands they love if it means they get paid back in loyalty perks and priority access to special offers or new products.
We also asked survey respondents what kept them subscribed to a brand. Again, the answers reflected the current marketing data moment to a tee:
Rank your top 3 reasons that make you want to keep subscribing/
engaging with a brand
Rank your top 3 reasons that make you want to keep subscribing/engaging with a brand
Note: the percentage of respondents who ranked this answer in their top 3 reasons
Consumers understand that making their preferences explicitly known means that they get something in return. They also understand that the power is in their hands to cut off the relationship with a brand if it’s no longer serving them.
This type of data exchange also lends itself well to text message marketing. Consumers are happy to let a brand they love into their SMS inbox, and many love the convenience of having those brands just a text message away.
Many brands are turning this knowledge into next-level loyalty experience, using text message marketing to invite consumers to interact with the brand lifestyle. It’s not just sales and product drops that can be delivered via text; it’s also lifestyle content, tips and how-tos, and FAQs. These messaging content options represent the perfect example of what CRM looks like now; a convergence of shifting attitudes towards privacy sharing and brand engagement.
"Text messaging is a powerful customer acquisition and retention tool. We use personalized text messaging to build brand awareness and loyalty. We rely on text messaging to nurture our customers—from helping them create their EatStreet account to driving repeat orders.”
Passive data gathering is making way for the active choice of consumers telling brands what information they want to share, with the expectation that their data will be turned into increasingly desirable suggestions and more personalized interactions. The direct and intimate nature of SMS—of engaging with consumers in the same way that they engage with many of the people in their own lives—gives brands an amazing opportunity to build and refine their customer profiles with each text message exchange.
Like all things in the world of personalization, it’s a tough tightrope to walk. But it’s a balance worth striking, and work worth doing. Not just because the average consumer expects this level of tailor-made interaction, but because SMS is the perfect platform to give you the data you need to make that relationship accurate and rewarding for everyone involved. You’ll be set up for long-term success, ready to lean into every curveball that changing marketing industry trends throw your way.
"Subscribers want to hear about your community and how you thrive within it. Include messages in your program that highlight your culture and what you stand for.”
CONCLUSION
It all comes back to conversational commerce
We’ve covered a lot of ground in this report, so let’s recap. There are a number of exciting marketing trends emerging with consumers, and conversational marketing can play a pivotal role in each of them.
Businesses can satiate consumers’ vast—and varied—appetite for convenience with a text message marketing program. Consumers’ definitions of convenience when it comes to shopping no longer just mean getting something delivered quickly. Businesses also need to factor in where friction points can occur, and find ways to reduce them. Being available at every stage of the purchase cycle can go a very long way in influencing the customer’s purchase journey experience.
Speaking of purchase journeys, customers are relying on hybrid shopping—in all its forms— now more than ever. This can look a number of different ways, depending on what the customer is buying, how familiar they are with the brand or product, and what the online shopping environment feels like. Brands can both recreate and supplement the in-store experience of clienteling without overwhelming consumers by reaching out through SMS to help during the decision-making stage.
Finally, recent changes in privacy laws have made the opportunity for first- and zero-party data exchange more important than ever before. This has proven to be a mutually-beneficial setup for consumers: they sign up for brands' text messaging programs, and they get a more personalized and curated experience in return. By providing their customers with the VIP treatment they crave, brands win their loyalty and attention in an ever-crowding field.
The world of conversational commerce has come a long way in its relatively young life, but its ascent is just beginning. We’re excited to see how it will continue to evolve in 2022 and beyond, and to help pave the way to make it easier for brands to communicate with consumers, and vice versa.
Methodology:
Attentive’s State of Conversational Commerce in 2022 Report survey was conducted December 27, 2021 through January 2, 2022. Based on answers from 5,377 US respondents, ages 16-65+.
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