Change in Consumer Behavior due to Pandemic (Source: McKinsey & Co.& ET.)
In the initial days of India’s first lockdown in March, consumers responded to the Covid-19 crisis with anxiety and fear, leading to panic buying of staples and hygiene products. As cases continue to increase and the economy shrinks, the consumer is adapting.
As the national lockdown restrictions have been slowly eased, fewer consumers report seeing a decline in income. Net intent on spending has remained consistently positive for many essentials such as groceries, entertainment at home, and household supplies.
A recent report by McKinsey & Co on the impact on consumer sentiment and behavior in 12 countries, states that 91 per cent Indians changed their shopping behavior due to the ongoing crisis. Many urban consumers, increasingly working from home and reluctant to deal with crowded public places, are moving online for their shopping needs. If demonetization compelled people to shift toward cashless payments, Covid-19 has made them adopt online to shopping. One in five consumers who ordered their last groceries online did so for the first time. For consumers aged 56 years and above, this figure was one in three. These days, people are buying larger pack-size products or multiple units at once.
People have become more mindful for how they spend their money by finding new ways to spend less.
90 per cent of consumers are making lasting changes to how they live, work and shop, and there is no going back to the pre-pandemic world for consumer brands. Consumers are now focused on their most basic needs while cutting back on nonessentials. They are more mindful of what they are buying, striving to limit food waste, shopping more cost consciously and are making healthier and environmentally sustainable choices.
Shifts toward remote learning and online personal fitness and wellness continue to accelerate, with high intent to continue for many habits acquired during the crisis.
Staying-at-home and working from home are becoming the norm. The ways in which people spend their leisure time are changing because of the outbreak and related social distancing measures, and again, these habits are likely to continue.
Entertainment, learning and DIY (Do-It-Yourself) have also seen a rise - this trend is reflected in the types of apps that consumers are downloading and the devices they are purchasing, related to entertainment, news, healthcare and education.
“Stay home", “Stay safe" is the new way of life. Even though one hopes to come out of the pandemic someday, people may avoid unnecessary travel and may try to find a solution through other online mode of communication.
We never had dreamt of putting a lock to the gate of our religious places. Festival and. Social distancing forced everyone to be at home and celebrate with close family members only. They observe their holy day over video call.
The demand for local products, digital commerce and omnichannel services such a home delivery, chat features and virtual consultations is surging. Consumers are now focused on their most basic needs while cutting back on nonessentials.
As many as 85 % of the consumers in India surveyed opined that they are shopping more health-conscious and are focusing more on limiting food waste. While 75 % of consumers opine that they are being more cost-conscious when shopping for products and 71 % feel that quality, safety, and trust are the most considered brand attributes in purchasing decisions.
Crisis moments always present an opportunity and will see more sophisticated and smart use of technology. No one knows exactly what will come out of this. Consumer behavior has already changed a lot in last few weeks and months and giving an opportunity for the innovation to re-write the new normal way of living.
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