COVID-19’s rapid spread has changed everything we knew about consumer’s purchase patterns. Increased social restrictions, unemployment, remote work, limited access to products and services, among other economic and societal shifts have had a drastic effect on consumer aspirations and purchase behaviour. Some, potentially long-term.
As the uncertainties of the COVID-19 crisis continue to impact consumer behaviour, businesses need to stay attuned to the changes and pivot their marketing strategies in a timely manner.
In this article, we look at some of key trends we’re observing across global consumer segments and how brands can adapt to them.
Health and safety a top priority
Health and wellness have inevitably become one of the most dominant factors influencing consumers’ decision-making during these uncertain times. Studies show that consumers are actively checking safety and hygiene measures taken while purchasing goods or services. Furthermore, COVID-19 has amplified the demand for health and wellness products, including supplements, in hopes to boost immune system. Extended lockdown measures has also prompted a rise in indoor exercise with the global fitness equipment market growing by 170%.
This ever-increasing focus on health requires consumer-facing industries to keep customer health and safety needs to be at the heart of business strategies where relevant.
New spending patterns
Staying at home for extended periods of time has given rise to varying spending patterns among consumers. A vast majority made lifestyle changes and switched to value-shopping due to uncertainty. While the stockpiling mindset has calmed down since April 2020, people are buying more per shop than before the COVID-19 pandemic. Furthermore, studies show that consumers continue to spend judiciously, shop locally, explore alternative brands, and are carefully researching products and comparing prices before spending.
With global working-hours declining by 12% and nearly half the global workforce at the risk of job losses, many are putting off expensive purchases. They ‘re also more mindful of what they’re buying, reducing wastage, and researching bang-for-the-buck alternatives often at the cost of brand loyalty.
But not all consumers are in a state of retrenchment due to COVID-19. According to Nielsen Intelligence Unit, higher income groups are spending on luxury products to compensate for unrealized vacations and other out-of-home experiences.
Digital commerce reigns supreme
Increased social restrictions and safety concerns have prompted consumers to go digital for everything from grocery essentials to healthcare. According to a study by Bazaarvoice, being able to buy products online will be a major deciding factor in the way people shop. Data by Common Thread Collective shows that e-commerce sales for certain categories, such as medical products, cleaning, and baby products, have increased 50% during the pandemic versus the same time in 2019. Moreover, these habits are expected to stick in the long-run, making digital adoption indispensable for business success.
A greater emphasis on digital commerce can help businesses recoup lost sales due to reduced footfalls in physical stores. But this shift to virtual requires traditional businesses to build new capabilities to maintain their competitive edge. For example, superstore PetSmart has partnered with DoorDash to offer same-day contactless deliveries.
Similarly, optimizing digital storefronts to deliver experiences that meet current needs through insight-driven content and features that bridge the digital-physical divide, such as 360-degree views, 3D visualizations and virtual reality, will be key for success in the digital realm.
The rise of the homebody economy
After national lockdowns, we’re observing the rise of the homebody economy – one that’s built up of products and services designed to cater to consumers who prefer to stay in than go out. Studies predict that the future consumer will welcome this ‘nesting time’ with loved ones, even as the present-day consumer may feel locked down out of compulsion. Health and safety concerns and increased financial savings will encourage a stay-at-home attitude with DIY home improvement and gardening products seeing an upsurge across the US.
Several brands have introduced innovative campaigns catering to this burgeoning trend. Brookelinen offered a 25% discount on its loungewear. While sustainable basics brand Everlane ran a “bundles of comfort” sale. Lou & Grey, an athleisure company, made a “suuuuper laid back” Spotify playlist and Cuup, a lingerie startup, started “Stay-at-Home” advice emails curating lists of book recommendations and inspirational tips from influencers wearing their product. West Elm, a furniture and decor company, began creating Zoom backgrounds of beautiful interiors.
As more consumers grow accustomed to doing things in the comfort of their homes, there’s tremendous opportunity for brands to offer digital-enabled solutions to traditional needs. One of the best examples is the significant rise of telemedicine and online education in this environment. Similarly, brands in categories such as leisure, retail, and fitness are shifting to virtual business models to cater to this evolved, tech-savvy consumer.
The coronavirus pandemic has landed most businesses in uncharted territory. To stay relevant in the post-COVID-19 world, keeping a pulse on changing consumer needs and demands is imperative. Continuous tracking of consumer sentiment and underlying factors that influence their behaviour will be instrumental in helping businesses take proactive measures to navigate this crisis.
