Impact of covid-19 on consumer behaviour in India
Impact of covid-19 on consumer spending in India
As the global economy is gradually transitioning from the respond phase to the recovery phase, India is also looking at riding on the festive wave and positive consumer sentiments to return to normalcy. Between the complete lockdown, the relaxed stayat-home orders, and the gradual unlocking of the economy, quite a few things have changed in the consumer industry landscape and economic activity has picked up. Although economies across the world are in various stages of re-opening, workplaces and factory floors in India have again started bustling with increasing levels of activity. However, the normal acts of visiting a store, eating out, staying in a hotel, or taking a flight have become a cause of concern for people across different age groups. Consumers are likely to spend with caution and save more to prepare for worse times. On the other hand, businesses will likely be averse to investing in capital-intensive projects and have curtailed hiring due to economic uncertainties. The journey to resume normalcy seen before COVID-19 hit the economy will be fraught with challenges related to personal and financial well-being. The interplay between personal safety and consumer sentiment is affecting consumers’ spending behaviour.
This report captures a few interesting findings for India. It reveals that overall anxiety levels are dropping noticeably for the first time since the onset of the COVID-19 pandemic.
Net spending intent for essential and discretionary goods
Intent to spend more over the next four weeks
Future outlook the Consumer Industry -
Resetting priorities:
Realigning and rebooting their business models, and adapting (by being agile) to changes faster are what retailers need to rebuild a growth path.
Going beyond traditional hiring models:
The pandemic has introduced a transformation in the work culture. Quite a few organisations have permanently moved to the work from home models, cutting their real estate cost (rent, etc.) and administrative overheads. Now organisations are actively engaging gig economy (freelancers) and contractual workers.
Ensure customers’ safety:
The travel industry has started offering touchless onboarding and following every safety protocol to promise travellers a safe and comfortable experience and hence ‘Health and Hygiene’ will play a big role in transforming brands evolve and innovate, collaborate and market themselves.
Automotive sector to drive on the two- and three-wheelers and small car segments:
The sector may focus on these segments in the short-term to stay afloat. It should also expect an upsurge in the used vehicle segment in large and small towns.
Adopt Omni-channel approach:
The retail segment should embrace this approach that involves a mix of the offline (physical stores) and online (e-commerce, digital) channels. In other words, retailers need to connect with consumers at every touchpoint and offer them a wholesome “phygital (physical+digital)” experience to attract and retain them.