COVID-19 has permanently changed consumer behaviour. Accenture research shows that 95 percent of consumers are making significant and lasting changes to how they live, work and shop. Retailers need to rapidly distinguish customer behaviour myths—there’s no going back—from the new realities, and adapt their strategies to meet changing consumer needs and add value.
Accenture research shows that consumers are grappling with a range of emotions as they consider what the future will look like. Some of the concerns they raise include changes in their way of life—such as working from home and their ability to travel—and the impacts of the pandemic on mental health, financial wellbeing, and the economies they live in.
Our COVID-19 Consumer Survey, enabled interesting categorisation of consumers—from those ‘On the edge’ at one extreme, to those going ‘YOLO’ on the other.
There’s no going back. Some changes are here to stay. Retailers need to reassess their product and service portfolios to meet shifting customer needs.
Categorising the new consumer
‘On the edge’ survey respondees are the 20 percent of consumers who are currently extremely worried about health, job security, finances and going out in public. These consumers are cutting back significantly on spending and are exploring new sources of income. At the other extreme are the ‘YOLOs’, the 17 percent of consumers living for the moment (you only live once) who want to make up for time lost, and who are most likely to increase spending once the pandemic subsides. Those falling between include the ‘Tentative returners’, the 'Me. Reinvented’ and the ‘Stubbornly seeking normal’ consumers.
of ‘On the edge’ consumers are cutting back on spending
of ‘Me. Reinvented’ consumers are buying more locally sourced products
of ‘Stubbornly seeking normal’ consumers will not change spending patterns post-outbreak
Myths vs realities
So, what does this mean for retailers? Our survey results exploded some myths.
The biggest myth is that consumer behaviour will go back to the way it was. It won’t. While current trends may diminish somewhat, there won’t be a full return to pre-pandemic conditions. Shifts in shopping activity, product and channel choices are emerging. Here are some more specific realities:
There is still a place for premium products. In fact, the majority of consumers are maintaining or increasing purchases of premium products.
While consumers are trialling new products—63 percent of consumers say they have changed brands—loyalty to those brands should not be assumed.
The spike in online buying is not a passing phase. Consumers will continue to shop online at rates significantly above pre-pandemic levels.
The crisis is fundamentally changing how and what consumers buy and is accelerating immense structural changes in the retail industry. With these emerging new behaviors, what should retailers be doing? Key recommendations include reassessing product and service portfolios, rethinking consumer segments and assessing ecosystem partners that facilitate adaptation to new customer demands. These changes will force organizations to reimagine their digital strategies to capture new marketplace opportunities and digital customer segments.
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