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Consumer Behavior research - LIBA, June 2020
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Impact of COVID-19
COVID-19 has transformed the economic and consumer landscape
COVID-19 has transformed the economic and consumer landscape
A new normal will emerge, as fears of a pandemic or other destructive events remain palpable.
Profound impact on economies, businesses and consumers worldwide, changing the way consumers live, work and shop.
Economy
Economy
Global economy to enter it's worst recession since the 1930s
Businesses are facing huge challenges in navigating through the turbulence, while coping with disrupted supply chains and rapidly changing consumer needs and habits.
Consumers
More households are expected to fall into lower-income segments.
Consumer
Consumers re-evaluate their life priorities
Behaviour shifts are expected to last a long time
Impact of Covid-19 on Market sizes
The impact of COVID-19 on market sizes
With the exception of fresh food, packed food and home care, Covid-19 will have a negative impact on market
Consumers refocus on health and financial security
Consumers refocus on health and financial security
Consumers have been forced to develop new habits
Consumers of all ages, income levels and cultures deal with two major crises in one: health safety and recession.
Significant shifts in who is shopping where, and how often.
Telehealth will be instrumental in healthcare.
Six Themes Transforming Consumer Markets
Six key Coronavirus era themes
From Sustainability to Purpose
A more holistic approach that aims to create social, environmental and economic value.
From Sustainability to Purpose
Pursuing purpose over profit
Putting purpose first, while protecting the triple bottom line.
How “From Sustainability to Purpose” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
Pursuit of the greater good
Brands must invest more in locally produced goods
Concentrate on their brand heritage, transparency, safety and provenance.
How “From Sustainability to Purpose” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Companies are keen to be seen supporting local communities
Planet-before-profit mantra
Purpose-driven action
How “From Sustainability to Purpose” impacts consumer markets
Food and Nutrition
Food and Nutrition
COVID-19 is expected to realign consumers’ priorities
Food waste, animal welfare and food security, will be front-lined
Packaging sustainability and sustainable sourcing, will lose out
Sustainability is initially taking a back seat to health
How “From Sustainability to Purpose” impacts consumer markets
Home and Technology
Home and Technology
COVID-19 has both refocused and reclassified sustainability
Sustainability to co-exist with primacy of hygiene and serving consumers during economic hardship.
How “From Sustainability to Purpose” impacts consumer markets
Services and Payments
Services and Payments
The pandemic has decimated some service and payments whilst accelerating others
Gives industries a chance to reset and build back better
Putting people first to achieve the triple bottom line
Hometainment and the New Experiential Consumer
Consumers redefine and adapt their daily routines
Hometainment and the New Experiential Consumer
Experiential customers creates strategic opportunities across products and services,
How “Hometainmentand The New Experiential Consumer” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
Online shopping transformation - Quasi physical store conditions
Focused on the at-home universe
Brands will need to secure high-quality and meaningful experiences with all channels
How “Hometainmentand The New Experiential Consumer” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Development of Countertop commerce
Desire to take control of the preparation process
Sedate, solitary aspect to experiences
More of a focus on health and mental wellbeing
How “Hometainmentand The New Experiential Consumer” impacts consumer markets
Food and Nutrition
Food and Nutrition
Meal occasions are coming into the home
New found love for cooking
Multitude of new social forums and free online cooking classes
How “Hometainmentand The New Experiential Consumer” impacts consumer markets
Home and Technology
Home and Technology
Digital education, gaming and online esports events to further strenthen
Toy companies are further repositioning as entertainment companies,
Expecting digitalisation of play and pastimes to strengthen.
How “Hometainmentand The New Experiential Consumer” impacts consumer markets
Services and Payments
Services and Payments
New approaches to reaching consumers and building consumer relationships
The need to justify any and all consumer visits will intensify
Where and How Consumers Shop
COVID-19 accelerates trends, such as the rise of online, click & collect, frictionless retail and D2C
Where and How Consumers Shop
How “Where and How Consumers Shop” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
COVID-19 has emerged as the ultimate retail disruptor
Potential to accelerate e-commerce adoption, expand click & collect formats
Catalyse frictionless retail and D2C operations worldwide
How “Where and How Consumers Shop” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Decimation of foodservice and on-trade in the beverages sector
Alternative consumer channels including D2C and B2B2home.
Recovery will be slow
How “Where and How Consumers Shop” impacts consumer markets
Food and Nutrition
Food and Nutrition
A turning point for e-commerce and a boost for meal kits is tempered
Adverse impact on impulse channels
D2C opportunities could emerge
How “Where and How Consumers Shop” impacts consumer markets
Home and Technology
Home and Technology
D2C brands come to the forefront
Click & collect also sees a significant boost across markets
How “Where and How Consumers Shop” impacts consumer markets
Services and Payments
Services and Payments
Click & collect and alternative check-out options have become expected
Social selling, super apps and marketplaces have grown drastically in importance
Significant shifts in who is shopping and how often implies changes
Wellness Redefined
From Sustainability to Purpose
A more holistic approach that aims to create social, environmental and economic value.
Wellness Redefined
The wellness movement is set to witness another paradigm shift causing leaders to rethink strategies through a renewed lens
Pursuing purpose over profit
The primary aspects of optimal health, health in its purest form and the adoption of a holistic approach are being reinforced.
Putting purpose first, while protecting the triple bottom line.
The notion of happiness becoming a more tangible commercial prospect
How “Wellness Redefined” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
Beauty and wellness convergence becomes even more prominent
Digital health solutions are reinforced
Luxury wellness brands move into mental, emotional and spiritual health
How “Wellness Redefined” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Outcome-based products will evolve
Even more emphasis on mental wellbeing; mindfulness and preventative health
Responsible stimulants will be more pronounced
How “Wellness Redefined” impacts consumer markets
Food and Nutrition
Food and Nutrition
Fundamental balance of exercise vs nutrition becomes disrupted by even more sedentary lifestyles
Accelerates the shift towards more holistic wellness and eating
How “Wellness Redefined” impacts consumer markets
Home and Technology
Home and Technology
"Home as health hub” resurfaces and is reinforced
Consumers ramp up their at-home cleaning and hygiene routines
How “Wellness Redefined” impacts consumer markets
Services and Payments
Services and Payments
Travel industry will look to health and wellness as a key driver
Need to bring an impression of calm, comfort and serenity to the consumer experience
Trust and transparency will become even more important
Innovation and the New ‘Core’
Coronavirus Era has led to a rapidly changing operating and consumer environment and left the appetite for experimentation diminished.
Innovation and the New ‘Core’
How “Innovation and the New Core” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
Prominent innovations involve providing home-based services for customers
Companies are reorienting around simpler, more cost effective product lines
How “Innovation and the New Core” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Demand for immunity / health-boosting ingredients
Consumers will pay a premium
Insurgent brands will struggle to survive
How “Innovation and the New Core” impacts consumer markets
Food and Nutrition
Food and Nutrition
'Value’ likely to become the single most important factor
Products that can replicate the restaurant experience in the home
D2C channel will develop from a low-base
How “Innovation and the New Core” impacts consumer markets
Home and Technology
Home and Technology
Innovation refocuses on agility of consumer reach and communication, efficiency and costs to consumers
Value for money surges forward
Strategies will likely combine a mix of premium quality and a well-communicated value-for-money approach.
How “Innovation and the New Core” impacts consumer markets
Services and Payments
Services and Payments
High-end e-commerce and live streaming events to expand as launchpads for new brands and new products
Domestic travel could expand
The ‘New Normal’: What’s Here to Stay?
How consumers work, shop, eat, drink and play will be driven by lingering home seclusion and ‘risk dread
The ‘New Normal’: What’s Here to Stay?
An increase in working-from-home will be matched with an increase in hometainment–cooking, eating and socialising at home.
How “The ‘New Normal’” impacts consumer markets
Health, Beauty and Fashion
Health, Beauty and Fashion
Creates opportunities related to therapeutic properties and mental wellbeing
Companies will work to diversify supply chains
Continuing to invest in digital tech and virtual experiences to maintain engagement
How “The ‘New Normal’” impacts consumer markets
Drinks and Tobacco
Drinks and Tobacco
Social distancing knocks the very concept of group consumption
Consumers will be jaded, less prone to want to post on social media about their drinking preferences
Healthy in the first instance, happy second
How “The ‘New Normal’” impacts consumer markets
Food and Nutrition
Food and Nutrition
Packaged food industry is doing well
Stockpiling bringing purchases forward in some cases
How “The ‘New Normal’” impacts consumer markets
Home and Technology
Home and Technology
Tech brands that focus on low-cost strategies will benefit by proving to offer the biggest bang for buck
Companies operating in traditionally more premium spaces like Apple will not likely be impacted as much due to their loyal bands of affluent diehard fans.
How “The ‘New Normal’” impacts consumer markets
Services and Payments
Services and Payments
Retailers will focus on their value proposition and technology
Sales will disproportionately go to the adopters, resulting in a more consolidated retail landscape globally
Shopping centres, Inherently social, will have to work hard to draw shoppers
The outlook for consumers
Contraction in spending will clearly impact the performance of consumer markets
The outlook for consumers
Retailers and consumers becoming increasingly risk averse
Health and value seem likely to be key priorities.
Per capita consumer expenditure to fall by 5.2% in real terms in 2020 globally, and to not return to 2019 levels until 2022.
The evolution of consumer markets
The evolution of consumer markets
Acceleration of e-commerce adoption and frictionless retail
Ethical values to the fore
Health, Beauty and Fashion
Luxury under pressure
Health, Beauty and Fashion
Experiential consumer a particular challenge
Drinks and Tobacco
The concept of drinking occasions has been dealt a hammer blow
Further development of countertop commerce
Drinks and Tobacco
Food and Nutrition
Big players focus on what sells now and core line
Food and Nutrition
Meal occasions coming into the home
Online forums and cooking classes
Sustainability shifts to highlighting economic value of premium hygiene and integrated smart technology
Home and Technology
Home and Technology
D2C, marketplaces and subscription models enhanced
Home as health hub
Restaurants will increasingly experiment with groceries, supporting home meal prep and delivery
Services and Payments
Need to justify consumer visits will intensify