TRENDING: What will shoppers do next?

by Louise Burgers. Has the current COVID-19 pandemic changed some shopper behaviour permanently; and if so, how do retailers and brands need to adapt? Will the growth in ecommerce continue post-Covid and what do the digital players need to do to retain new customers?

The IAB South Africa (Interactive Advertising Bureau) invited Norman Reynecker, Kantar Retail, Sales and Shopper Director, Consulting Division, and Retailing Africa, to participate in their weekly Insights in Action series this week, on Wednesday, 24 June 2020, to discuss latest retailing insights from Kantar research all around the globe informing shopper trends. Retailing Africa was asked to add to the current conversation on the trends we have been tracking in the publication; as well South African innovations in the sector under lockdown. The discussion was moderated by IAB SA CEO, Paula Hulley.

This was the IAB’s 7^th Wednesday Webinar for marketers, advertisers and brands, since lockdown due to the COVID-19 pandemic began. In partnership with Kantar, the IAB has been updating digital marketers and brands, in particular, on shopper behaviour and digital trends. This week Reynecker spoke about: COVID-19 and its impact on shopping and the implications for the path to purchase. COVID-19 has completely shaken up the shoppers’ path to purchase, research has revealed the world over. While this dramatic shift in shopper behaviour has upended the entire retail eco-system, there were also opportunities for retailers and brands to innovate; particularly with the acceleration of ecommerce – out of need and necessity.

Retail insights

Reynecker highlighted the dramatic channel shifts and the opportunities within:

1. Capitalise on the retail shakeup

The shift to ecommerce is likely to be long-lasting; so, retailers must ensure that they deliver exemplary experiences that align with shopper expectations and priorities – both online and offline. This is what will drive customer loyalty. Retailers that don’t deliver when promised; or deliver with stock missing; or delay refunds when stockouts occur – as we have all experienced, will not build the customer loyalty required to keep customers shopping online as lockdown eases further and once COVID-19 fears have subsided. As 50% of customers have indicated that their future online purchasing will increase, Reynecker urges retailers to minimise shopper friction across all retail channels; despite the change in the retail environment and all the new rules and regulations that are now in place to keep shoppers and employees safe from infection. Even after the crisis has passed, 70% of shoppers indicated that they would continue to go online to shop the categories they were forced to buy online due to lockdown. Delivering a positive experience for these shoppers was key to retain them.

Implications for brands from Kantar: Adapt your channel strategy to capitalise on emergent opportunities and optimise shopping experiences to encourage new buyers to return and stay with you.

2. Balance touchpoint activation

While under lockdown, digital media consumption increased dramatically, playing an increasingly influential role on the purchase decisions along the path to purchase, Reynecker reported. Many campaigns that would otherwise have been wrapped around physical events, have also gone online, further encouraging digital media consumption. However, Kantar believes that non-digital touchpoints are still key, as physical retail opens up and consumers move and travel around more public spaces. Now, more than ever, an omnichannel strategy is essential for brands.

Implications for brands: An omnichannel strategy and mindset is needed to activate the path to purchase on digital touchpoints, especially while offline, non-digital touchpoints are muted by a less comfortable shopping experience currently.

3. Look beyond promotions

Reynecker warned that brands were facing increasing pressure to offer promotions and discounts, both from retailers wanting to make up for lost sales; as well as from shoppers facing financial pressure. Several research studies recently have highlighted consumer dissatisfaction with how the price of essential goods has risen since lockdown began – mostly due to supply chain disruption. Reynecker advised that protecting brand and category value in the long term is essential: “Brands need to look beyond motivating sales via promotions and instead show leadership and demonstrate purpose, brand salience and meaningful differences.”

Implications for brands: Do not become over reliant on promotions and discounts; but connect with your customers to build brand value.

Price sensitivity

Kantar reports that a massive 93% of consumers are worried that the crisis may return in the months after South Africa has hit its peak Covid infection rate and deaths (which is what South Africa is currently experiencing and will experience in the next two months during our Winter). This will have a long-term impact in terms of job losses and businesses struggling and financial insecurity and price sensitivity (77% of South Africans). Commented Reynecker in his presentation: “We see increased levels of price sensitivity as households feel the negative financial effects of lockdown, a trend that appears across markets.”

He said there was a significant opportunity for brands to motivate beyond promotion, by showing leadership and demonstrating purpose. Brands could do this by highlighting connections to the local community; or even just be transparent in where products are sourced from when they are locally sourced or locally manufactured, which may help to stimulate purchases and reassure shoppers.

Locally, Polo is doing that with great effect on their new TVC – with a poignant story of supporting local business during this time of lockdown; while highlighting that the Polo is manufactured locally, plus including a promotion on the new Polo Vivo. A South African flag is inserted in the tagline Drive Local, in place of the ‘o’ in Local. On point branding during these difficult times, as it highlights the beautiful spirit of South Africans that endures.

The future shopper

In the conversation with Reynecker afterwards; and in fielding questions from the industry audience Zooming into the discussion; I made the point that I’m not so sure that shoppers will find the shopping experience a pleasant one anytime soon. Shopping is no longer retail therapy; it has become a fearful, uncomfortable, hurried affair; devoid of all sensory experience, unless you count burning eyes from all the sanitiser being sprayed around at the entrance to every mall and shop. Our shopper marketing expert columnist, Carolyn White, writing on Retailing Africa recently, urged retailers and brands to look to other channels and innovations, particularly online, to maintain brand loyalty and connect with their brand fans.

Reynecker asked me what shopper behaviour I thought would stick? This was my outake:

• Shoppers would continue to favour brands that made them feel safe and were reassuring during this time, whether they were able to sell or not; citing Castle Lite’s strategy in using outdoor space already booked, to run a campaign to reassure South Africans that, “We’re gonna be alright”.
• Price sensitivity will remain until the economy begins recovery and the job market improves. Given the spikes predicted in Covid waves, this could be another 18 months to 2 years, which is a frightening thought.
• Brands must not be about the hard sell at a time like this – they need to show empathy for what consumers are going through financially; what families are going through with the dilemma of whether to send children to school or keep them home, given infection spikes at some schools recently; and the fact that South Africa is only reaching its peak of the first COVID-19 wave now and we still have heartbreaking months ahead of us.
• Retailers and ecommerce providers also need to look at low tech options to address the needs of the mass market – the 80% of consumers who do not live close to shopping hubs and have to travel far to shop in bulk. Delivery options, like start-up YeboFresh has innovated, need to be more commonplace and invested in.
• Innovations like the V&A Waterfront’s partnership with Pargo to install a Click & Collect service for all shops within the mall, should be rolled out to other retail parks for those back in the office and not at home for deliveries.
• Purpose must be a key driver in brand communication. Brands are the new influencers in the absence of celebrities and other influencers society usually follows under normal conditions – what are brands doing to help individuals locked down alone; children at home for months without normal playtime; families facing hardship and heartbreak? What about the data needs of communities trying to educate children without the privilege of uncapped data and tech at home? How are brands and retailers reassuring consumers about their health and safety?

My final take was that brands and retailers need to show consumers empathy during times of crisis such as these; and make consumers’ lives and choices easier to reduce stress and make them feel safe.

*For the full deck of slides, including graphs with key data from the Kantar presentation, click here.

Louise Burgers (previously Marsland) is the Publisher and Editor and Co-Founder of RetailingAfrica.com. She has spent over 20 years writing about the FMCG retailing, marketing, media and advertising industry in South Africa and on the African continent. She has specialised in local and Africa consumer trends and is a passionate Afro-optimist who believes it is Africa’s time to rise again and that the Africa Continental Free Trade Agreement (AfCFTA) will be a global gamechanger in the next decade.

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