Paradigm Shifts in New Consumer Behavior

Sumit Sehgal Jan 11, 2021

Covid has had disastrous impacts wherein many citizens have been set back on their goals by at least a few years, if not more. With brands, it is a similar story.

Many brands have treated this year in primarily two ways – stay silent, wait and de-grow or get aggressive, be impatient and grow. The smaller players have gone silent while the larger brands have taken this as an opportunity to get stronger due to the positive outlook of the board in a negative situation coupled with good cash reserves.

From here on, the world will never be the same again. Something or the other is likely to disrupt the World – technologies, pandemics, environment changes, policies, governments, international trade alignments or power exhibitionism. This really means that changes are going to be more frequent, of higher-order and have a far-reaching impact. This is the New World we have stepped in. And this is much more than VUCA. It is VUCA +, A stronger and more powerful VUCA.

What does this really mean for consumers now? The consumer has been impacted physically, socially and emotionally and the duration of this impact has been long – more so like 12 months or maybe even more. This is why, this deep-rooted impact is likely to give birth to a coronial who will undergo a metamorphosis in his habits, behavior and attitudes during 2020. Such changes take decades to establish. However, Covid has accelerated this manifold.

The psychological impact on the New Coronial consumer will therefore manifest itself in various ways when it comes to brand selection. This will have a subsequent impact on marketing and communication in multiple ways.

The most important change is a more cautious consumer – cautious about life choices in general and brands in particular. Consumer journeys, therefore, are likely to become longer for non-impulse products and the consumer will be reviewing products more critically to fit into his exact need. The consumer will pass over frivolous features and benefits and focus on the core rational benefits which will meet his needs. This really means that consumers will down trade to basic product solutions – maintaining a balance between necessity and lifestyle up-gradation. Marketers need to focus on these SKUs in their portfolio and ensure high functionality as well as tapping all available distribution options to increase distribution width.

The second important consumer behavior that will emanate is a more risk-averse consumer. Consumers will save more and spend less. The innovators and early adopters are likely to pull back their aggressive acquisition of new product solutions and bank upon tried and trusted brands. Older and stronger brands will benefit, and new brands will have a tough journey ahead. The lineage brands can benefit greatly through relevant product extensions to capitalize their brand equity. The new brands will either perish or piggyback on e-commerce marketplaces and build their customer base through deep discounting. Which means thin margins to survive. Therefore, lean organizations and marketing budgets.

The third and the last important change in consumer behavior is the refreshed outlook on health and hygiene. Whilst this may have ordinarily taken one generation to adopt, it has now been achieved in a year. Brands that take a seamless product inclusion or extension to health and hygiene benefits will not only stand out as progressive but also partake in the consumers’ wallet. The product which has core benefits around this theme will surely lead revenue generation, but other product categories will need to build such features integral in the secondary product benefits. Consumers will reject any outlandish and force-fitted claims.

A changed consumer behavior has been forced upon us. Organizations and brands need to understand this change deeply, truly recognize this change internally, re-orchestrate their marketing strategy nimbly and execute effectively with minimal wastage to reinvent their brands for the Coronial era ahead.