Has COVID-19 Changed Consumer Behavior Forever?

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COVID-19 has brought unprecedented disruption to businesses around the world across practically every sector, with companies having to adapt, pivot, or close altogether as a result. Consumers’ needs are no longer what they were six months ago, and in order to survive, organizations have had to find ways to meet these new demands.

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COVID-19’s Impact On The Behavior Of Consumers

From sales teams to marketers, these events have impacted almost every department of every business. Entire content calendars have required adaptation, as businesses must “simultaneously demonstrate an awareness of the current situation while maintaining a tone which does not read as exploitative”. Businesses may also need to prioritize different products from those they had planned to promote, as well as the channels through which they sell them.

However, as well as thinking about the here and now, companies must consider how consumers will behave in the long-term. Though some of these changes may well be temporary, businesses can’t underestimate the overwhelming impact this global emergency has already had on spending habits. Research suggests that several of these will remain the norm long after the COVID-19 crisis has ended.

Online Shopping Is Prevailing

E-commerce was a threat to physical retail long before COVID-19, but lockdown has meant that those who had never previously shopped online are now embracing it. In fact, compared with the same period in 2019, e-commerce spending in the US rose by over 30% between the start of March and mid-April.

Even though consumers will be able to return to stores in time, it’s expected that many will continue shopping online, especially for essential purchases like food. “The thing about online grocery shopping is that for the most part, once people get into the habit of doing it, say after three or four purchases, it becomes a routine and you don’t go away from it easily,” Guy Elliott, a senior vice president at business transformation company Publicis Sapient, told Essential Retail. “I believe if this continues for a while we will see a significant sustained shift to online purchasing even post-virus.” Essential Retail also predicted that this move to online shopping could also stretch certain non-essential items like workout gear, noting the spike in exercise equipment company Peloton’s shares in mid-March.

COVID-19 won’t necessarily mean the end of traditional retail, and many consumers will probably be looking forward to shopping in person once again. However, this period has certainly caused e-commerce to grow at an even faster rate than expected, making it more important than ever for brands to have an online presence in order to build direct customer relationships.

Enlightenment Is Replacing Materialism For Consumers

COVID-19 has had huge implications for the global economy, which the World Bank estimates will shrink by 5.2% in 2020 — the most severe recession in 80 years. With millions of jobs at risk and bleak financial prospects ahead, lots of consumers will have to be more careful with their money. That doesn’t mean non-essential items will no longer be of interest, but it does suggest that people will be seeking purchases that are more enriching to their lives.

This is especially true of millennial and Gen-Z consumers, two of the biggest spending demographics. Research has found that both age groups tend to value experiences over physical goods, which could bring about a decline in the traditionally materialistic approach to shopping. As Forbes contributor Kian Bakhtiari explains: “To a certain extent, consumers will become investors and could spell the end of conspicuous consumption. In the future, young people — similar to corporations — will expect an ROI on their purchases. The return could be social, financial, educational or gross happiness.”

As a result, many brands will have to consider how they can bring real value to their customers’ lives. For example, another Forbes writer has predicted that “prominent luxury logos that display one’s wealth and extravagance will appear distasteful in a post-coronavirus world”, but luxury brands that fall within the wellness market stand to benefit from the pandemic.

Conscious Consumption Is Even More Important

A shift towards ethical, sustainable, socially responsible shopping was gathering steam prior to COVID-19, and this has accelerated as consumers have had time to reflect on their shopping habits. Brand experience firm Big Red Rooster touched on this in their report on consumer behavior, and their VP of strategy and insight told CNBC that coronavirus has encouraged shoppers to think globally. “We are having these shared experiences on a human level,” she explained. “This is giving us awareness about how dependent or interconnected we are.” As a result, she believes that consumers are far more likely to consider how their purchases impact the world and the people in it.

It’s notable that, over a 90-day period towards the end of April 2020, Google searches for “how to live a sustainable lifestyle” increased by over 4,550%. Meanwhile, a report by Accenture revealed that limiting food waste, buying more health-consciously, and making sustainable choices were the top three consumer priorities in the wake of the novel coronavirus. This is perhaps best reflected in the growth of organic food sales during this period.

“COVID-19 is raising consumer awareness of the relationship between nutrition and health. Consumers are buying more organic and healthy foods as they look to boost their personal immunity,” reported research agency Ecovia Intelligence. They are confident this trend will continue, adding that previous health and food scares like SARS and mad cow disease “caused an initial sales spike followed by sustained demand for organic products”. As a result, Ecovia believes the industry could come to be worth $150 billion within five years.

There is also greater interest in buying locally — 65% of people favor shopping with domestic businesses — with consumers being mindful of their impact on companies in their community. Big Red Rooster found that 68% had tipped their local stores more than they usually did, and many think that this newfound appreciation will continue after COVID-19, with consumers remaining loyal and committed to helping sustain local businesses.


About The Author

Edward Coram James is an SEO expert and UX design professional. As the CEO and Co-Founder of Go Up Ltd, an international marketing and design agency, Edward is dedicated to helping his clients navigate the complexities of the digital world and maximize their online potential.