James Bond takes his martini shaken, not stirred. Stirring is gentle, shaking is not. When it comes to commerce, shopping and retail have without a doubt been thoroughly shaken. Just like James Bond, COVID-19 doesn’t stir diplomatically. So what does that mean for the new shopping context?
For shoppers, the cocktail shaker has proven especially icy. According to the latest Kantar COVID-19 Barometer, 43% of consumers have already seen their income negatively affected by COVID-19, and 52% of shoppers say they are paying more attention to prices. But that is just the tip of the ice cube: the massive change to the daily routine means that different people are doing the shopping, buying different items at different times and in different stores.
Will boomers continue to use ecommerce to the extent they have been? If dad has taken over most of the grocery shopping, will he be selecting the same product as mum? Shoppers going to new stores will encounter a different assortment, and select new items. Which new brands will stick, and which new stores and channels have shoppers discovered they like? What are the SKUs of choice for financially squeezed households?
From shaken, to squeezed
Obviously, one of the most significant shake-ups of the crisis is the financial impact on families. Household budgets are going to be squeezed for a long time to come. Additionally, the global uncertainty will dent consumer confidence, as people opt to save for an uncertain future rather than spend. This has implications for categories and retailers, as both must consider how to better meet the needs of the large proportion of the population who will now be on a tight budget. All brands need to rethink their portfolio from two points of view.
First, your brands and products. In your category, which product benefits are newly price-conscious shoppers willing to sacrifice? Do you have suitable SKUs (products, pack sizes, prices) for the newly under- or unemployed? In some markets cost-effective bulk packs will be desirable, but in others, consumers may not be able to afford to stock up. How will you communicate the appropriate SKUs to shoppers, and in which stores?
Second, category reset. Expect retailers to soon revisit many categories - including yours. The operational changes happening right now — from one-way shopping paths, fever thermometers, masks and gloves, to plexiglass dividers and all-new queues — affect store layout, category adjacencies, shelf space and of course assortment. Are you ready?
Staying safe, supporting local
The world has gone local. Sixty-five percent (65%) of shoppers globally now prefer shopping in stores close to home. And 53% of consumers are more in favor of buying goods and services that have been produced in their own country. Expect this to continue; the last economic crash was on Wall Street, more a concept than a place. This shake-up expresses itself in the local community: neighbors and neighborhood stores, farms, students, jobs, shopping streets and businesses must be supported and maintained. What does this mean for your brands and categories? Do you have the right products in proximity stores? Can you speak to “local” at shelf?
There are many jobs to be done, and then done again, and manufacturers need the insights to take decisions. It might not feel like the right time to get a perfect understanding of your category, but even an imperfect picture of the shopping context will allow you to be faster and more effective. After all, a martini is just James Bond getting started.