The prevailing COVID-19 pandemic seems to have forced many of us to alter our purchase patterns. All of a sudden, consumers do not make purchase decisions like they used to before the pandemic. According to Mckinsey’s report, Global surveys of consumer sentiment during the coronavirus crisis, the epidemic as shifted new consuming habits, changed consumption patterns, and re-evaluated the spending priorities. More people are stretching dollars and spending value. How people view, brands are now very different from 2019. The world-wide lockdown has dramatically impacted on the demand and distribution of products and services around the world. Although economies are beginning to reopen, consumers are still feeling the impact of the pandemic due to the reduction in income that accompanied the crisis.
Based on the research from early pandemic breakout countries, such as China and Korea, consumers are less likely to interact with non-essential products. One of the most affected categories is Fashion. Brands like J.Crew, Neiman Marcus, John Varvatos, True Religion, J.C. Penny, and more labels either closed or bankrupted during the Covid-19 lockdown. The reason is complicated, not only pre-existing financial conditions but also the decreasing of brand value and losing client connections. Business is shifting gears to focus on online shopping and curbside pickups, yet the real question is what brands can do to strike the return.
1- Ready for the inside out change: Digital Transformation
Evaluating the consumer trends within this time, staple products and home-bound entertainment have jumped to the forefront of consumer spending. With people staying indoors and many businesses supporting the work-from-home initiative, the majority of retail transactions would be facilitated online or through web-enabled platforms. As noted by Bynder’s State of Branding Report, the results suggest most teams have transitioned to remote working more smoothly than many would assume. This indicates a shift from the office teamwork model to the remote teamwork model.
The major profiteers from the present health crisis are e-commerce websites, healthcare products, and service providers, and supply chain delivery businesses. On the other hand, the primary losers are the luxury goods businesses and the tourism industry. For instance, restaurants
are getting more innovative in value creation by ensuring that customers have more access during this pandemic period. By improving on their supply chain services, the focus has been shifted to order pickups and delivery as against the traditional eat-in services that they are known for.
2- Caring Friendship over Purchasing Loyalty
For brands, it remains unknown if consumers are still going to keep playing the loyalty game. Human beings are cognitive misers by nature, and they will surely rationalize their purchasing decisions. Now is the time brands will realize that what they erroneously termed as customer loyalty is nothing more than habitual purchasing. True loyalty is absent in the face of economic crank. For this reason, it becomes necessary for brands to engage in business strategies that would allow them to keep their customer base. This can be achieved by offering value at lower prices. Organizations need to understand that the present situation does not support profitability; instead, the business objective now should tend towards long term survival.
3- Shifting to content creating + educational business model
Going forward, marketing strategies should focus more on digital media, with out-door advertising becoming a fund-wasting endeavor. Effective brand strategies should be driven towards delivering customer value if businesses want to experience repeat purchases. Marketing teams need to go back to the drawing board to identify the additional benefits
that may be offered across the traditional P’s of marketing to achieve better results. Rather than embarking on promotions, brands are changing the communication scope to education, sharing up-to-date information with customers on the reason they should purchase particular products or services.
What matters for now for any brand is survival and transform.
Thus, to stay connected to customers during this health crisis period, there is a need for businesses to adopt measures that will position their brands stronger in the minds of the consumers. First, they need to respond to the needs of consumers by reshaping their market plans to accommodate the emerging changes in consumers’ demands. It is essential to reset your business model by redefining relationships with customers while also rethinking on your various portfolios. Lastly, you should start thinking of which strategies to ensure that your business survives this pandemic rather than thinking of super-normal profits in the short-run.