As we pivot from managing the COVID-19 crisis to finding a recovery path, it’s clear that living through lockdown has profoundly altered how we view the world.
We live and work in a world of uncertainty, driven by fear, isolation and technology. This is transforming what people want from brands and what drives their purchase decisions, creating changes that will define the new normal for years to come.
In this article, we’ll explore those long-term changes in consumer behaviour and the new habits and demands we can expect. Understanding these newly formed behaviours will help businesses create more resonant messages to effectively target potential customers. Let’s see how we can connect with these new deep-rooted buying drivers of consumers in the next normal.
8 ways COVID-19 has shaped new consumer behaviours
First, let’s explore the forces behind these long-term changes in consumer behaviour; the economic downturn and the lockdown. All are instigating a shift in behaviours across work, learning, communication, shopping, travel, life at home, entertainment and health.
McKinsey’s model for ‘How Covid-19 is changing consumer behaviour – now and forever, 2020’ outlines the following aspects:
Work:
- Rise of unemployment
- On-the-go consumption decline and remote working.
Learning:
- Spending on learning adjacencies
- Remote learning.
Communications and information:
- In-person sampling decline
- Shift in media consumption
Travel and mobility:
- Reduction in tourist spend and travel retail
- Increase in domestic tourism
Shopping and consumption:
- Surge in e-commerce
- Preference in trusted brands
- Decline in discretionary spending, trading down
- Larger basket, reduced shopping frequency
- Shift to stored closer to home
- Polarisation of sustainability
Life at home:
- Nesting at home
- Surge in online
Play and entertainment:
- Preference for digital entertainment
- Entertainment channel shift (e.g cinema to streaming)
- Additional playtime
Health and well-being:
- Focus on health and hygiene
- Acceleration of organic, natural, fresh
- Fitness on demand
- E-pharmacy & e-doctor at scale
Navigating the new landscape of new drivers and buying behaviours
These newly formed lifestyle behaviours are impacting how people engage, choose and buy brands. Fear, isolation and digitisation are the three key behavioural accelerators driving different ways of consumer spending. These accelerators are now firmly rooted in the way we live, behave and buy. Each is driving another set of newly formed behaviours that are now dictating new consumers’ demands and purchase preferences.
This model shows how these three key accelerators of behavioural change have created a set of new drivers for preference and purchase. Let’s explore each in more detail.
1. Fear and anxiety
Fear and anxiety were already key cultural concerns across all generations before Covid-19. Now the pandemic has further fuelled that fear.
Consumers now are not only worried about their health – financial fears are also coming to the forefront, with so many businesses forced to shut or slow down. To counter this deep-rooted existential anxiety, consumers are looking for businesses and brands that can promote calm and deliver an enhanced sense of security and wellbeing.
The new behaviours driven by fear and anxiety:
Survival mode
Fear and anxiety have sent many into survival mode for the first time in decades. Nielsen’s recent survey states that 49% of consumers are willing to pay a premium for products and services that deliver verifiable safety and high-quality assurances. It’s clear that security is a key strategic purchase driver during the pandemic.
Support in times of crisis
As we have dipped in and out of lockdown, with fluctuating levels of fear and anxiety, we see that certain brands are being rewarded with preference and loyalty. These brands help consumers and their employees safely mitigate risks during the crisis.
Privacy and autonomy
Customers now want companies to put them in control of the personal information they were previously willing to share. The business model of capturing and sharing personal data in return for services or promotions has to move to the next level as a result. Consumers now expect businesses to demonstrate how they use consumer data to benefit others — and even show how this data can be used to have a positive impact on communities, society and the planet.
What changes are going to stick beyond the lockdown, becoming the new normal?
- Down: on-the-go consumption is likely to fall.
- New trend: larger baskets will be the new norm.
- Ones-to-watch: the preference for trusted brands, the demand for sustainable solutions and nesting at home.
- Up: the focus on hygiene and health.
2. Digitisation
With self-isolation a necessity for many, consumers have adopted digital solutions in a matter of weeks, an evolution that would have taken a decade otherwise. The result is a fundamental and lasting shift from away from face-to-face contact and in-shop services, replaced by novel digital services and experiences.
Consumers have new digital expectations, and businesses and their brands need to keep up with them. Research reveals that more than 54% of UK shoppers would change from a favoured brand or retailer to a competitor if the overall digital experience did not meet their expectations. Moreover, 63% of shoppers would be more loyal to a brand that offers exceptional customer experience, which covers immediate access to relevant content relating to a product, along with reliable delivery services. *
Although this seismic shift seemed daunting at first, many businesses are now harnessing the financial opportunities that digitisation brings through a more dominant online presence, virtual events and remote direct-to-consumer services. Brands such as Oral-B, L’Oreal and Philips feature in the top 10 brands in the Digital IQ Index for leveraging their digital content, experience and media channels to stand out from the competition this year. *
The Next Normal behaviours driven by digitisation:
Techcelleration
The pandemic has accelerated the digitisation of products and services that aim to entertain consumers and create a sense of (new) normality. In the fashion industry, gaming has been used to create digital avatars to try out clothing and accessories at home. Many cosmetic brands are now cleverly using AR, allowing consumer to try make-up virtually while preventing contamination.
Fulfilment expectations
The pandemic has hugely increased consumers’ reliance on delivery services, spurring a rapid evolution of ordering and payment apps across the hospitality industry in particular. Forward-thinking businesses are even investing in the development of unmanned and autonomous delivery services. Environmental consciousness among consumers of all generations has also risen, driving demand for product deliveries with less unnecessary packaging.
Virtual services
Working from home and avoiding large gatherings will continue to dominate the new normal. Large offices are expected to become hotdesking hubs, with employees spending more time in their local neighbourhoods. Virtual conferences, events and trade shows will have to evolve, with creative and interactive solutions making them more effective and engaging. Business travel is expected to be largely replaced by virtual meetings, with more productive tools for remote collaboration urgently needed. In healthcare, telehealth and virtual healthcare apps are finally gaining wide-scale traction.
What changes are going to stick beyond lockdown, becoming the new normal?
- Down: declining consumption of discretionary product and services.
- New trend: trading down and price sensitivity.
- Ones-to-watch: reduction of international travel and the increase of domestic tourism and short local ‘sanity’ breaks.
- Up: the focus on digital and virtual customer experiences, backed up by seamless delivery.
3. Emotional isolation
Recent studies into behavioural change and consumer sentiment show that lockdown is bad for our mental health. Since the start of the pandemic, people have found themselves with a more sombre mood and a contemplative mindset. In the UK 69% of adults report feeling somewhat or very worried about the effect of COVID-19 is having on their life. The most common issues affecting people’s wellbeing are worry about the future (63%), feeling stressed or anxious (56%) and feeling bored (49%).***
As a result, people now prioritise their emotional wellbeing, and this will continue in the next normal. Purchasing priorities, now more than ever, are driven by concern for physical and mental wellbeing, while seeking a sense of control. This trend is only expected to rise in the near future, instigating a boom for self-care apps that offer emotional support and therapy to counter loneliness and low mood. Kindness has now become a top currency. This means brands that promote acts of kindness are being rewarded with consumer loyalty, even if this is sometimes a way to offset guilt for non-essential purchases.
The next normal behaviours driven by emotional isolation:
The meaning economy
As consumers question what it means to spend their time well, we see more considered purchasing behaviours, replacing the flashy displays of wealth that used to dominate the consumer market. Consumers now focus on products and services that bring personal joy and have a positive impact on the greater good, such as the environment or community. As mindless purchases are replaced by meaningful ones, brands have an opportunity to make consumers feel part of something bigger or contribute to leading a better life.
Time well spent
Since the pandemic, consumers are increasingly prioritising time affluence over time poverty. A new type of lifestyle that is moving away overburdened schedules and workaholism, in favour of more leisure time with a strong focus on emotional wellbeing and more sleep. A slower pace of life will cause a further rise in solutions that combine wellbeing with entertainment, such as the boost in home-based activities like crafts, reading and mindful cleaning, which are now often powered and shared by social communities or virtual platforms.
Focus on family
During COVID-19 people are increasingly re-evaluating what brings fulfilment and what adds real value in their lives. Family life has become more important than before the pandemic. To foster harmonious and positive family relations, while dealing with the stress of being cooped up in one space, families are now looking to adopt mindful practices and use play as a survival tool. For businesses, this brings opportunities to capitalise on delivering meaningful and playful activities for both indoor and outdoor spaces. This trend has already led to a big rise in tech-enabled gamification to combat sedentary lifestyles. We are also seeing a rise in products and solutions that stimulate more time outside and immersion in nature. These new solutions are much in demand, as they help families to combat anxiety, nurture emotional literacy and improve mental resilience.
Localists
Proximity and convenience have become increasingly important purchase drivers, as a result of lockdown travel bans and declining use public transport for longer trips. As we transition to the next normal, consumers will continue to value their local community, buy more local brands, and even support businesses negatively impacted by the pandemic. Local businesses and shops are playing a more prominent role than before in people’s lives. Many are even becoming highly valued community-led spaces and sanctuaries. For local businesses, this provides a great opportunity to build stronger and deeper relationships with local consumers, while also providing a smaller environmental footprint for products and services.
What changes are going to stick beyond lockdown, becoming the new normal?
- Down: declining consumption of flashy, overindulgent products and services.
- New trend: rise of the e-pharmacy and virtual e-doctor.
- Ones-to-watch: remote working and hotdesking for a few days in the office.
- Up: surges in e-commerce and shift from physical entertainment to digital entertainment channels and fitness on-demand at scale.
Accelerating your business in the next normal
We are BBI, a group of strategic thinkers and creators that help brands to move their audiences. For a decade we have been supporting our clients to capitalise on the latest consumer behaviour trends and remain preferred brands, with our unique proven approach. We call this CustomerologyTM, our business acceleration tool, that delivers true performance by fusing the latest data and behavioural science to optimise the marketing potential of your business in fast-moving times.
Contact us to discuss how to accelerate your business in the next normal – we’d love to help.
Sources
Diagram- WARC: Coronavirus Global Change Accelerators, 2020
* Navigating the New Normal: How Customer Experience Has Become Even More Important for Retailers and Brands as They Look to the Future, NUXEO, 2020
**Source: Gartner Top 10 UK brands FMCG in digital, 2020
***Health.org.uk, 2020