Erratic Customer Behavior

Erratic Customer Behavior

At a time when everything seems completely haywire, one thing is for certain, consumer behavior has shifted significantly and only time will tell which behaviors will stick for the long run. Regardless of region, these behaviors have been fairly consistent according to a recent episode from eMarketer’s Behind The Numbers podcast.
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minute read
Dec 15, 2023

At a time when everything seems completely haywire, one thing is for certain, consumer behavior has shifted significantly and only time will tell which behaviors will stick for the long run. Regardless of region, these behaviors have been fairly consistent according to a recent episode from eMarketer’s Behind The Numbers podcast. Here’s what we’re seeing across the board:

Large gatherings, travel, dining out, crowded amusements have stopped almost completely.

This has happened to a varying degree around the world as the result of different forms of government. In Asian and most European countries, governments are more centralized; so, making swift nation-wide decisions around (ie. travel restrictions, businesses/school closures, large gatherings, etc.) has been more effective than in countries like the United States that have a decentralized government structure whereby states make individual decisions for their residents. It’s not the only reason, but it is a big reason why the USA may be harder hit than other nations.

  • Will this behavior last? The overwhelming sentiment is that after being cooped up in their homes, people will resume travel, dining out, crowded amusements, large gatherings, etc, with a new appreciation for this commodity that has been denied for so long. That said, an initial boom in these categories is to be expected; however, how long it will last is nebulous. Additionally, until a vaccine or cure is identified for COVID-19 there may still be some hesitancy especially among those who are immune-compromised (ie. elderly, those with health conditions, pregnant women, families with young children, etc.) to dive into these otherwise enjoyed activities.

Online shopping has seen an unprecedented surge that is exceeding infrastructure currently available.

This is largely the result of two changes:

1) As major non-essential retailers have closed their doors, shopping online has become the only option and 2) Even though essential retailers such as grocers are open, people who can afford grocery delivery are doing so to avoid exposure to the virus. Additionally, in regions like the USA where food and beverage delivery from private restaurants and larger franchises like QSRs has been deemed an essential service, delivery of those items has grown in popularity. Another category seeing growth beyond capacity is meal kit delivery service such as Blue Apron, Hello Fresh, etc.

  • Will this behavior last? Perhaps! These convenience-services typically have a higher barrier to consideration due to stigmas such as “I want to pick out my own produce because I don’t trust that they will pick the best fruit/vegetables” and “are these meal kits really worth it?” have now suddenly pushed aside as potential loyal consumers are giving it a try. While there may be an initial downfall in usage once the dust clears on COVID-19, it would not be surprising to see these services resurface in usage out of convenience. Much of the future success of these industries will reside in their ability to continue to build off of the momentum seen during the pandemic once the crisis dies down.

Cashless payments are on the rise.

COVID-19 has brought awareness to something we don’t typically consider - how many germs live on the cash we use to buy everyday needs. As a result, there has been a significant lift in credit card usage both on e-commerce and in-store. Additionally, greater consideration has been seen for contactless payments via mobile wallet usage whereby a consumer can simply hover their phone over a credit card machine to make a payment.

  • Will this behavior last? The popularity of credit card payment certainly doesn’t seem to be going anywhere fast - we expect usage to remain fairly steady; however, there may be a decline in the willingness to use cash. Additionally, there may be a lift in mobile wallet usage that is sustained. As consumers discover how simple it is to store credit cards and coupons on their phone, they may be apt to continue using this feature; however, much of the momentum of this trend will depend on retailer’s willingness to provide easy access to this contactless payment feature.

TV, streaming and mobile phone content consumption has seen exponential growth.

It’s no surprise that consumers stuck at home have been resorting to more screen time. Be it for education, entertainment, physical activity, or news consumption the growth of eyes on digital channels has been exponential across the globe.

  • Will this behavior last? Probably not. People were already addicted to their phones long before COVID-19. Once the crisis is over, people will be craving time away from screens and may have a newfound appreciation for limiting screen time in their day-to-day.

Bulk buying, financial conservativeness, and delivery time tolerance are soaring.

We have seen consumers going out of their way to stock up on things they deem a necessity. Across the globe this has included toilet paper, canned goods, PPE (personal protective equipment), etc. At the same time, with financial recession and potentially depression on the horizon, some consumers are also trying to be fiscally conservative. As a result, consumers are less likely to make luxury purchase decisions, especially those with a heavy price tag now and in the near future. Additionally, we’re seeing more delivery delay time tolerance among consumers. US consumers in particular are used to 1-2 day shipping and typically do not convert if they feel shipping times are nebulous; however, unstable product supply has caused this consumer behavior to be eliminated almost entirely.

  • Will this behavior last? Bulk buying and delivery time tolerance will fall to the wayside as the world returns to normal; however, financial conservatism may have a longer impact in the wake of the COVID-19 crisis. It will take time for consumers struggling with unemployment and pay cuts to regain financial confidence and make luxury purchases. How long that will be truly varies by regional recovery times and governmental financial support for citizens.

While we cannot know what consumer behaviors will definitely stick and which will dwindle, we can plan for what today’s consumer needs based on their behavior. As mentioned, this is not a time for set-it-and-forget-it marketing; rather, marketers must vigilantly stay abreast of the government decisions and healthcare advancements that impact consumer behavior day-to-day and recalibrate accordingly.  

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