How consumer behaviour is changing and how to prepare

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POSTED ON 31st August 2020

If history has taught us something, large fundamental changes to the way we live momentarily will have an impact on values and consumer behaviour that will endure for some time and brand that adapt quickly will survive and in many cases, thrive.

WHO predicts the pandemic that is disrupting all our lives across the globe will end within 2 years, which means a dampened more cautious environment for all for some time.  

Whilst restrictions will gradually ease, and some of the Government support reduced and ends, there will be enduring changes in behaviour that brands need to be aware of and plan for in their product and service offering as well as their marketing and messaging.

A recent McKinsey report indicated some key themes in consumer behaviour going forward.

People will prioritise getting good value and essentials over luxury and discretionary spending

The key trends that will endure for a while are:

  • People are becoming more mindful of where they spend money.
  • Consumers are switching  to less expensive products to save money where possible.
  • Consumers will spend more time than before researching brand and product choices before buying.

Tip:

If you can offer more cost effective alternatives, do. Help your clients or customers with information on how to reduce spending or save money. Also make sure that you are providing more details and information online on your products and services than your competitors. 

 

Online shopping growth will be sustained

Online transactions will outgrow “in real life” purchasing. In the McKInsey report, online spending was tracked around the world, with most categories seeing more than 10% growth in their online customer base during the pandemic.

Online conversion is also growing and the share of wallet spent online is also predicted to increase.

Tip:

 Brands that offer a very smooth and seamless online purchasing process, as well as tracking the customer’s online behaviour and adapting their marketing and messaging dynamically will be a key competitive advantage.

 

Loyalty will continue to be easily disrupted

As a result of Covid supply shortages, particularly in countries with longer and harsher lock-downs, many consumers were forced try an alternative product, brand or store experience. People will shift to new brands if the one they want is harder to come by as a result of supply chain disruptions or poor access to purchasing online.

Tip:

Stay on top of inventory levels. Ensure that you are communicating regularly with your customers and monitoring competitive pricing.

 

Health and caring is critical for brands

Products and services that are seen to visibly care about the safety and help of their consumers and staff will do better. There is increased awareness of how brands take care of their customers, community and how well they “do good” for others as a result of Covid-19.  

Consumers are more aware and will make purchasing decisions on how well brands are seen to be caring for their community in the act of doing business.

Tip:

Make contributing to your community part of your business practice and ensure that you communicate any good that you are doing clearly to consumers and stakeholders.

 

Home will still be where it all happens for a while

In most of the countries McKinsey surveyed, respondents said they weren’t yet comfortable to get “out and about” as much as they used to. For those that are getting out more, shopping is the key activity they are likely to resume first, quickly followed by work and some socialising.

So ensuring that you make it easy for people to access products or services from home is still important.  

Tip:

Innovating your product or service offering for people to enjoy at home or to adapt to assist people working from home is still a smart move.

 

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