As the outbreak of COVID-19 continues to impact the world in grave proportions, it goes without saying that concerns about well-being and risk of exposure remain paramount in consumers’ minds. Lasting longer than anticipated, the impact of the pandemic on the consumer psyche is extending beyond concerns about health, and affecting their financial, social, and psychological wellbeing. The outcome will be a new consumer archetype that must be considered and addressed differently.
Post COVID-19, it will likely take four to six months before there is stable evidence of what the recovery will look like. Much of this will be dictated by where the consumer sits along the spectrum ranging from pessimistic and pragmatic to optimistic and hopeful. Where they sit on that scale is relative to how consumers see the pandemic has affected them personally. Regardless of their position, a new order of needs and weighted priorities will emerge that will define where factors such as the need for reassurances, information and transparency, value, and new expectations around service come into play in their interactions and relationships with their retailers of choice.
Regardless of the length of recovery, we believe that there will be a short-term surge to brick and mortar. People are inherently social, and once the restrictions are lifted, pent-up demand will bring crowds back to shopping malls, restaurants, and other retail forums where they can re-engage in the ritual of shopping. Curiosity to see what has truly changed, or the pleasure, perhaps short-term for some, of shopping differently than they have been of late, or the return to their “normal” for others will be reasons for the short-term surge to brick and mortar shopping. Retailers must plan now with strategies to capitalize on the opportunity it represents for short-term conversion and long-term sustained behaviours, or even accelerate behaviours to close the recovery gap.
To do this effectively, retailers will need to think outside the box and reconceive the physical shopping experience relative to the need and purpose of space and the functional and experiential needs that must be addressed. They must revisit and redefine their value proposition, as well as, what messaging needs to be reinforced and where in the experience they need to appear. When it comes to online behaviours, some that have been amplified by COVID-19 will likely continue. Once the entrenched versus latent impact of online behaviours is understood, they can be more deliberately addressed in a next generation shop experience. In hand with this, will be new technology requirements that may become a necessity to address this “new normal”.
To address the myriad of questions and situational considerations that will emerge, retailers must focus now on developing their recovery plan. To get things started, retailers need to catalogue and learn from the different perspectives and experiences of employees across different parts of the organization. Key learnings and ideas need to be distilled and then incorporated into an ideation process where insights are used to drive the development of a new, informed and visceral retail experience. It will also be imperative to study and isolate how customer practices have changed and the new customer opportunity that is uncovered. Identify your end game and deliberately chart your course to act with certain speed and agility. Tactics such as savings coupons and reward points won’t be enough. A strategic plan of action will bring customers back – and the feeling of trust will propel them right to the top of the loyalty ladder.