Understanding new consumer habits ‘key to survival’ for retailers, GroupM study finds
Consumers have permanently shifted their shopping habits during COVID-19 with the survival of retailers hinging on how they respond to new trends, according to a GroupM study.
The media agency concluded that lockdowns and enforced shop closures have caused a fundamental and long-lasting change in behaviour.
Even consumers who were previously reluctant to shop online have now migrated to digital shopping, leaving physical stores with mounting problems.
The report, COVID-19: A Game Changer for Media and Purchasing, said firms have been forced to accelerate their digital strategies.
Their very future rests on the ability to react, it found.
“Understanding and responding to the user needs and behaviour of online audiences will be key to survival for brands and retailers,” the report said. “What started as simply making a purchase eventually progressed to buying into new categories, purchasing high-ticket items, and shopping and buying via mobile.
“Every time these behaviours crystallised for a new set of consumers, it permanently shifted their online buying habits. Previously sceptical or technically challenged consumers have had their hands forced and subsequently learned the benefits of buying online, both for maintaining social distancing as well as for sheer convenience.”
At a global level, the proportion of people shopping online each week climbed 8%. However, markets particularly hit by COVID saw online shopping increase 27% COVID-19 has forced “laggard audiences and markets” to learn the benefits of online shopping, the report added.
GroupM found print newspaper consumption fell 8% during COVID-19 while there was a “massive uptick” of 76% in people watching TV or movies via paid-for or on-demand service.
The study said consumers “will hold businesses and brands to higher standards” across a combination of factors, including empathy, honesty and transparency.
“However, the relative focus of messaging will vary depending on the consumer group and whether the main driver of behaviour is anxiety-led or finance-led,” the company said.
“Those that succeed in meeting these tougher criteria will command consumer loyalty now and into the future. It is therefore imperative for businesses and brands to really understand the evolution of consumer needs across different attitudinal groups and markets.
“It is essential to be fully cognisant of the role brands and products can play in delivering the most appropriate and timely communication and messaging, ultimately ensuring brand survival and growth into the future.”
Globally, 70% of consumers said they are now more careful about how they spend their money, while 85% have actively made some form of change to their financial behaviour.
Almost half are now actively waiting for products to be on promotion, discount or sale and 36% are delaying big purchases.
