Personal care, food & beverage and home care are expected to recover faster as compared to other categories, primarily as these products are essential to survival and will be consumed irrespective of whether an individual stays at home or not
Furniture, electronics and appliances are expected to recover relatively slowly as consumers are expected to postpone their spend on discretionary products in near terms.
The unorganized retail and local kirana stores have been resilient in the current situation, which paves the way for retailing to become even more localized in the future.
As per EY analysis consumer behaviour (How they shop, live, use, consume technology and move) will shift across three horizons, the “now, next and beyond” phase.
The ‘now’ phase mentioned consumers stockpiling essential goods, significant surge in e-commerce and digital payments with kirana stores continuing to host smaller crowds, both in urban and rural areas.
In the ‘next’ phase daily life will resume, but health and economic concern will reduce consumer confidence. Brand loyalty will diminish as consumers trade down and consume cheaper private label brands. The focus on health will give more importance , the analysis highlighted.
Online adoption will continue to accelerate beyond the “crisis”. Consumers will be more conscious and purpose-led brands will win, it noted.
Pinakiranjan Mishra, Partner and National leader consumer product and retail, EY India said, “The covid-19 crisis will have a long term impact on consumer behaviour and retailers will need to devise the transformation strategies for now, next and beyond phase, to better match this new reality. Three possible trend which will emerge after this pandemic will be increased focus on health and wellbeing, higher demand for value brands and accelerated adoption of online.
The EY analysis further stated that to mitigate the disruption caused by covid 19 crisis, Indian retailers need to adopt the faster approach both to navigate the crisis “now and to plan for “next” and “both”.
“This pandemic should serve as a reminder to retailers to quickly build a flexible and agile business and operational model to take care of disruptions in the future. This will mean a significant focus on converting to digital enterprise. Thus, it is the time for retail players to get control of the current crisis and invest in the build out of more resilient organization: Mishra added.