As the COVID-19 pandemic continues to spread, customer buying behavior and spending patterns are dramatically changing. Today, customers worldwide are trying to stave off uncertainties by stacking up food and utility supplies. The pandemic has caused a big boost to online grocery shopping, especially the household staples and health-related goods, such as bottled water, hand sanitizer, toilet paper, face masks, and much more. While the fashion and other luxury goods market continues to slide. However, customer buying behavior and spending trends for health-related goods and emergency pantry items differ. To help retailers stay proactive and plan their next moves, the experts at Infiniti Research have outlined the key customer trends observed globally.
An accelerated shift from store to e-commerce in grocery
Our initial survey in March revealed that around 27% of customers had already changed their buying behavior. While the survey conducted this week shows that number nearly doubled to 58% as the government implemented precautionary measures such as store closure and social distancing to prevent the coronavirus spread. Consequently, e-commerce platforms are witnessing dramatic spikes in sales, which is driven by new customers trying online grocery shopping. As such, online brands are compelled to stack their online inventory to maximize profitability.
Yet another trend observed is that local retailers in the COVID-19 affected areas are witnessing an increase in product demand, compelling them to order inventory from their online counterparts. In a way, this is even helping e-commerce businesses to maintain profitability during this period.
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Customers doing bulk shopping
The unpredictable nature of the coronavirus outbreak is compelling shoppers to stock-up and buy in bulk. Prior to the coronavirus outbreak, customers were accustomed to getting anything they needed within a day or two. However, the situation is not the same anymore. Major online stores are not accepting new grocery orders for now as they are facing exceptionally high demand for delivery slots. As a result, the trend of placing large orders seems to be on the rise. A recent report from Infiniti Research shows that in the four weeks ending March 22, a record amount on groceries was spent at supermarkets across the world, especially in the European region. Demand for groceries has soared to such a huge amount that e-commerce giants are unable to fulfill customer needs and requirements.
Spike in shelf-stable products and depleting markets for fresh and exotic foods
The demand for fresh and exotic food items are declining and there is a rising demand for packaged or canned food products. This is because customers are not willing to take the risks of consuming items that may have travelled long distances and exchanged many hands with little or no way to prove their hygiene quotient. Instead, consumers are increasingly opting for packaged food items which are risk-free.
Owing to this changing customer buying behavior, retailers will need to conduct thorough market research and gather data-driven insights to efficiently make their next moves. Also, analyzing customer buying behavior, spending patterns, and usage is a way forward for businesses to gain a competitive advantage in the long run.
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Quality and trust take top priority for consumers
As the COVID-19 pandemic continues to spread worldwide, customer buying behavior is moving away from a cost-saving nature. Today, customers are more concerned about the quality and safety of the products. This trend in customer buying behavior is compelling businesses to communicate their safety measures clearly to customers. This majorly applies for baby care and food companies where customers demand the highest safety. These strategic initiatives can help businesses to build the trust and enhance sales.
How Business Can Respond to Changing Customer Buying Behavior
#1 Emphasize on Quality and Efficacy
As customers demand products that are free of risks and of the highest quality, businesses must focus on communicating how their products are risk-free. For instance, food companies can specify safety measures undertaken by them while manufacturing and packing products to build the trust of customers.
#2 Be transparent about local origins
Today, shoppers demand complete transparency from farm to factory to distribution and details of procedures undertaken to assure product safety. In this context, promoting a product’s local origin can help businesses to drive sales.
#3 Leverage technology
With digital connectivity taking a greater hold on everyday habits post the coronavirus outbreak, businesses that leverage the latest technologies and enable seamless interaction through direct-to-consumer offerings are expected to gain a competitive advantage.
By keeping a continuous track on customer buying behavior, businesses can better plan a contingency plan and act smartly. Our customer intelligence solution can help you understand changing customer buying behavior and spending patterns. Request more info here.