Decoding The Digital-Savvy Customer Ecosystem

The pandemic may have made a sly entry but with the kind of destructions and disruptions it has made in our lives and the economy at large, it is going to take us a while to reimagine ‘normal’ again. Taking the business part in focus, the pandemic brought the country to a complete standstill, pushing the global economy into one of the worst recessions in recent years. Businesses, in this regard, were marred by poor consumer demand, lockdown constraints, supply limitations, employee safety and much more. During the lockdown, approximately 71.31 per cent of the businesses dealt with reduced cash flows with the manufacturing sector being the worst hit, said a recent report.

If there’s one thing that has made a huge impact on these businesses, it is the changed consumer behaviour, which may perhaps be irreversible. The pandemic compelled these consumers to exude newer consumption patterns and go beyond the traditional methods of modelling their behaviour. With nearly two years into a crisis time, most consumers have settled into new patterns of behaviour for considerable lengths of time in response to the multiple waves of this pandemic.

Giving us a sense of some of the evident changes in consumer habits and behaviours today, Kapil Kohli, President, Retail, Usha International spoke at the "Industry Knowledge Exchange", a webinar hosted by BW-CII-SAP. For Kohli, shopping today has a new meaning altogether. Majority of the customers now are comfortable using the online channels and are reducing on to physical purchases. The pandemic has augmented the need for easy access to a product or service, along with looking for relevant information with the help of technology. “Consumers today are looking for a great experience, along with a great product. They are looking for personalised outcomes. Next, they have become extremely careful of their health. I believe such changes are here to stay and marketers must move towards it in a way that there is a segment-wise targeted positioning, to stop on optimising these kinds of consumer behaviour and get on the top of the market,” he says. 

Despite coming from a digitally native company, Bindiya Bhatt, Director, Myntra feels that there was a huge disruption in their space because Myntra has a lot of discretionary as well as essential categories. For some of the categories, the team did not anticipate the kind of scale it managed to reach. “Some of the categories grew disproportionately and completely shifted in the baseline. This led to permanent changes to some extent as this in the baseline is going to be constant. Besides, we have seen some trends stabilising in the recent days, so it's not going to be exactly how it was panning out back then but there is going to be a shift certainly.

Also, there's a lot of adoption from tier 2 tier 3 consumers across categories. This also looks permanent to us as people now have a flavour of e-commerce.”

The conversation further delves into how digital channels offered support revenue during his time. Pankaj Singh Parihar, VP & Head Digital & Digital Transformation – Godrej Consumer Product mentions that it was not that the pandemic started and digital revenues started kicking in. The company was already ahead of the curve in terms of investing in the right technologies, platforms and products, to be able to actually cater to audiences that were hoping to buy products online. “We were completely ready being in marketplaces or launching our own D2C destinations much before the pandemic and today, we are witnessing a huge influx of audience wanting to do more and more transactions. These transactions are also coming from Tier I, II & III towns and we are trying to figure the kind of products we can launch for them on our digital platforms. 

For the things that happened to us in the past 24 months, we have driven a huge jump in our digital commerce revenue,” shares Parihar. 

Ritesh Arora, CEO – India & Far East, LT Foods also agrees on the huge shift to online demand as modern trade platforms slowed down. “We had to digitise our supply chain in terms of replenishment tools capturing what needs to be where or what is getting stocked out. We were able to launch new products, understand the consumer & get better feedback by doing so. Also, while launching a product earlier used to be a heavy task, it has become much easier today. So, from that perspective, we were able to record a 2x growth."

Pointing to the many challenges that the pandemic invited and how quick brands responded, Ajay Motwani, Head of Marketing- Media, Trade, Consumer Business & CSR, Adani Wilmar asserts on the panic buying that happened during that time. “There were concerns with shopping at brick-and-mortar stores and hence, people moved online. They quickly adapted to online services even though they were not natives of it. From our end, we had to ramp up our supply chain significantly. While we were already engaging with an ecommerce platform, it only multiplied during this time. It did not go through a linear curve in terms of accelerating engagement. Having said that, digital allowed us to segment our audience so that we could appeal to a spectrum of their needs.”

As we read, technology-enabled some of the most impossible tasks. In fact, a plethora of consumers and brands leveraged the many benefits of technology during this time, given the paradigm shift towards online services. Highlighting how technology is helping map customers through their journey and offering personalised experiences to attract and retain them, Sudakshina Ghosh, Industry Business Architect Team Lead, Industry & Consumer Advisory Practice, SAP India, advocates to first understand who the new consumer really is and the relevant tech enablers that can get their mind and heart share. “Covid has changed a lot of consumption habits. Today, we are seeing an accelerated version of this change, something that would have otherwise been gradual. This change has further invited convenience, something that will reflect in our shopping behaviour forever. This is going to redefine the processes in which we engage with consumers going forward. Savviness is definitely something which again has received an impetus as a result of the pandemic, especially in categories that did not see much shoppers.”

Consumer Loyalty Prime

Customer trust is critical for all businesses. It is seen that loyal customers spend 67% more on products and services than new customers. Even though they make up to 20% of your audience, they still provide 80% of your revenue. Hence, in an over-saturated e-commerce marketplace, loyalty matters now more than ever. Commenting on how Paytm Money is instilling trust in the minds of its consumers and upselling using digital means, Varun Sridhar, CEO expresses, “When we launched direct mutual funds two years back, everyone was apprehensive initially but millions of customers came to our platform because of the value proposition. Generating trust is a very tough thing. Even if you're absolutely banging on, trust extends to build. 

As for upselling, we don't believe in that concept. We are in no hurry. We give the time our consumers want. Hyper-personalisation is alright if you are in a hurry. People in India are just at the start of managing money on their own. There is a long way to go. This is the trick of earning trust for us.”

For Madhav Nishtala, Director- Industry & Customer Advisory, SAP, a consumer will trust you fundamentally for three factors- they must be able to see transparency and how the brand is using the information shared by him. Second, the need for this information sharing or how it will help him in return. Third, to be able to control the information collected and to what extent and ability. “So, when these parameters are there, we have solutions that help us gather information. That’s when the customer will trust and that's all what most companies now are now looking at,” he adds.