This is the fifth text in our series that explores how the COVID-19 crisis will impact people’s relationship with companies and brands around the world. Read the first article here.
More than three months into this pandemic, shock and surprise about the present is settling down in favor of interest for what comes next. People are starting to prepare for a new normal. We have seen a lot of change during this period and the question now becomes: What will stick? What long-term transformation will we see?
Some short-term behavioral changes that we have seen so far might be permanent. But we believe that lasting change will only come if there’s a fundamental shift in needs and values associated with those behaviors. That’s what shapes how people see the world and the choices they make.
Here are four bets we are willing to make on lasting effects that companies and brands should keep in mind when preparing for a post-pandemic world:
Habitual consumption is finally online
Recently, many of us have had to get used to new ways to get hold of our daily essentials. Groceries and other FMCG form the backbone of habitual shopping, and it’s moving online to a large extent. The category has seen rapid online growth and companies have fought to keep up with demand for products, formats and delivery options.
Pre-pandemic, essential goods lagged in digitalization. In a thrilling twist, they’re now instead taking the lead in many geographic markets. The reason why habitual shopping was slow to move online is that consumers are comfortable when it comes to the basics. We often have weekly routines based around these purchases. This is also why it’s likely to be a lasting change, and why it could have ripple effects.
Companies should try to improve or simplify customers’ routines around essentials in this new setting. What do people want to purchase together? What can be delivered or picked up together? The essentials category is for now a junior in the online league, so there’s plenty of room for improvement.
We can expect that consumers will bring expectations established in other, more online savvy categories. Companies that wish to get ahead should evaluate not just product offering, but payment solutions, delivery options and sustainability aspects.
Reimagining person to person experiences
We will find that having to do everything at a distance has changed us. Not only is our perception of what is safe and comfortable in e.g. a retail setting completely different today, but we have also matured immensely as online consumers. New consumer groups have migrated online and there’s been massive growth in online equivalents in categories such a fitness, education and healthcare.
This means that the new normal will be filled with consumers that may wish to avoid stores, restaurants or venues as we’ve known them. They may also have developed a digital-first preference, meaning they expect and prefer online alternatives in many categories. Consumers that do shop at physical locations will arrive well-prepared, ready for an efficient experience and looking for personal advice.
Companies need to reevaluate their omnichannel strategy and identify which need each channel should cater to. Should in-store display of products or certain product categories be limited in favor of superior online presentations? Do physical locations need to evolve into efficient checkout locations? And which customer service should be available when and where?
We don’t believe it’s about moving everything offline to online. It’s not that simple. People will expect a superior customer experience, that’s the best of pre- and post-pandemic. Companies need to figure out what that means for their product or service.
Data opportunity vs. data risk
Data has made the news during these last few months. People have learned about emerging symptom patterns, superspreaders, GPS localization, and more. We’ve also seen how it can be shared, used for predictions and sometimes be misleading. The insight that data can be both good and bad, could be a polarized change of social attitudes around data and privacy in the new normal.
Many will find that providing and sharing personal information can in fact benefit both them personally and society as a whole. This is in stark contrast with the pre-2020 discourse about data, that was largely negative on the back off leaks and scandals. But in the pandemic, not allowing personal information to be shared has seemed selfish. One international report found that 53% would make their personal data available if it helped to monitor infection.
At the same time, we are seeing discussions about how surveillance implemented because of the pandemic is unhealthy for society and unlikely to ever be rolled back. This is especially, but not only, a concern in non-democratic societies. But no matter where, it highlights the importance of establishing trust for anyone collecting and using personal data.
Companies need to be aware of this opportunity/challenge combo. There’s an opening to start using data, use it more, or in new ways, as consumers understand the personal and societal benefit of sharing their data. But this needs to be done with honest intentions, clear purpose and a high level of transparency around how the data is used, to avoid negative effects.
Local trumps global
In recent years, there’s been criticism against globalization, and it’s been blamed for financial and social inequality, negative climate effects, and more. Alongside ongoing trade wars, the pandemic is yet another blow to globalization, that has highlighted its risks to both companies and people.
Companies have experienced major disruptions of global supply chains as China shut down in early 2020. Going forward, company leaders will have a hard time disregarding this financial risk, as many assume that this is not the last pandemic. We are likely to see companies consider regionalization, if not localization. Companies that have sought out new domestic suppliers during the pandemic might keep them.
On a consumer level, people that have realized that businesses are struggling, have been most eager to save the local ones. Campaigns like #supportyourlocal have been hugely popular in communities during the pandemic. Grocery chains also report increased demand for locally produced food, which is further fueled by increased health and sustainability concerns.
Depending on the company or brand, the rise of local over global will be either an opportunity or a challenge. Consumers will embrace truly local brands, and could also punish global brands or those making false claims of locality. Companies need to be purposeful and trustworthy, providing clear information about e.g. where products are produced, and if not locally, then why.
There are a lot of things we don’t know yet. Some things will absolutely bounce back to pre-pandemic mode, but everything will not. Now is a good time for companies to both assess risks, evaluate opportunities and start implementing changes. Chances are, once things get going, they get going fast. Why not hit the ground running?
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