1.01 – Assessing The New Consumer Culture
A study by NielsenIQ revealed that the COVID-19 pandemic and its economic impacts have significantly altered the shopping habits of 67 percent of consumers. The focus has shifted from frivolous wants to essential needs, a trend that’s likely to stick around for the foreseeable future.
Similarly, EY’s report “US Future Consumer Index 8: Do consumers drive the market or does the market drive consumers?” (covering May 2021-October 2021) highlighted the increased importance of service, quality, price, and product availability. These aspects, coupled with the rising expectations for brands to adhere to high environmental, social, and governance (ESG) standards, signify a profound shift in consumerism across all business sectors.
Kathy Gramling, EY Americas’ consumer industry markets leader, encapsulated this shift by suggesting that market forces might be dictating what consumers find important, rather than consumers driving these decisions themselves.
As we delve into how both markets and consumers have evolved, businesses, regardless of size, need to adapt to these changes.
Changing Consumer Behaviors Post-Pandemic
The onset of the COVID-19 pandemic has sparked notable changes in consumer behavior:
- 50 percent have reevaluated their values and outlook on life.
- 45 percent are reluctant to revert to their pre-pandemic lifestyle.
- 57 percent are making a conscious effort to save more money.
- 60 percent plan to maintain increased savings and cautious spending habits.
- 48 percent are buying less to save money.
- 58 percent will continue prioritizing value for money in future purchases.
Consumers now expect greater convenience in both online and in-store shopping options, home delivery, and curbside pickup, without incurring extra costs.
The Rise of E-commerce
The surge in e-commerce since 2020 is undeniable. According to the United Nations Conference on Trade and Development, the e-commerce sector’s share of the global economy grew from 16-19 percent in 2020. Online business-to-consumer (B2C) sales for the world’s top 13 companies reached $2.9 trillion that year. Among the top performers were Walmart, Amazon, Schwarz Group, Aldi, and Alibaba.
In the U.S., online retail sales soared from $519 billion in 2018 to over $791 billion in 2020. Walmart’s sales alone increased by 72.4 percent during this period.
Navigating the New Consumer Culture
The new consumer culture and economic reality can be both daunting and invigorating. Despite changing market conditions and consumer priorities, human nature remains constant. Emotions and attitudes still heavily influence purchasing decisions and brand loyalty. The availability of affordable technology for crafting personalized messages to various consumer segments helps level the playing field.
Understanding Consumer Expectations
Businesses today have unprecedented access to data about their customers’ wants, needs, expectations, and more. Monitoring consumer attitudes, political preferences, and lifestyles on social media allows for targeted messaging. Analyzing past behavior and predicting future behavior with real-time data and artificial intelligence enables businesses to meet consumers’ specific needs and engage with them effectively.
Aligning with Consumer Values
Modern consumers expect brands to align with their social, environmental, and political values. Failing to do so can result in lost loyalty, regardless of past efforts. With numerous options available, securing consumer loyalty is increasingly challenging.
Adapting to New Market Realities
To succeed in today’s market, businesses must adopt new strategies for product distribution, customer communication, and emotional engagement. Offering a fulfilling consumer experience that adds value, happiness, or excitement is essential.
This course will guide you through building effective marketing and sales plans, digital engagement, e-commerce programs, promotions, distribution channels, pricing strategies, and more. You will also learn how to develop emotionally relevant, creative experiences and measure marketing campaign results.
Addressing a Complex Consumer Mindset
Today’s consumers can be described as distracted and demanding:
- Distracted: Increased screen time is a significant factor. The average U.S. adult now spends over 17 hours a day looking at screens, impacting their engagement with brands.
- Demanding: Consumers expect brands to cater to their individual needs, offer multiple business options, reward loyalty, and provide exceptional experiences. They also consider a brand’s social values, corporate responsibility, and ESG actions.
Despite these challenges, with the right knowledge and tactics, business owners and marketing executives can thrive and excel in this new consumer landscape.
