Puneet started his career at renowned MNC, Honeywell, and later joined Defence Startup, delivering the strongest business side to the company in healthcare and defence market for over a decade. As CEO of Clensta International in association with the India Institute of Technology, Puneet is on a mission to provide hygienically induced environment-friendly and cost-effective products to everyone and anywhere around the globe. He is the mind behind the innovation that covers the design and manufacturing of Waterless and EDBC PAP Technology for the use of home care and personal care products.
Globally, the coronavirus pandemic has exerted an unprecedented impact on the habits and behaviour patterns of consumers. One of the biggest changes was the sudden surge in impulse buying and the stockpiling of goods.
Initially, consumers did so due to apprehensions of a shortage in stocks of essential commodities. But the recurring patterns of impulse buying and hoarding soon ended up creating artificial shortages of goods in most malls and markets across the country. After the nationwide lockdown that came into force on 25 March 2020, consumers hoarded items such as ready-to-eat foods, groceries, sanitisers, medicines, toiletries, face masks and more.
Drivers of Impulse Buying
Impulse buying by consumers is characterised by their purchase of products and services that are unplanned. Typically, this occurs when consumers succumb to a sudden, persistent and powerful urge to purchase something spontaneously and immediately.
Fuelled by this surge in impulse buying, there was a shortage of essential items when the outbreak peaked during the pandemic’s first and second waves. According to the impulse buying theory, diverse circumstances, as well as numerous internal and external sources, can push consumers into making impulsive purchases. After the national lockdown, this impulse was also driven by the fear of shopping in crowded marketplaces and facing unpredictable situations. In hindsight, changes in consumer behaviour should come as no surprise as nearly 1.3 billion people were suddenly barred from moving out of their homes.
Considering these circumstances, consumer brands and D2C (direct-to-consumer) companies quickly revised marketing strategies. Almost overnight, healthy, hygiene, safety, security and convenience turned into major purchase elements for consumers. As a result, most companies deployed digital tools within weeks or months – something that would have ordinarily taken years to achieve.
More than a couple of years later, COVID-19 continues to pose a threat as cases keep rising periodically in various regions worldwide. Consequently, most consumer companies have accepted this as the new normal for now. To counter the market uncertainty, alongside digital, companies have been using hybrid or omni-channel models to ensure their BCPs (business continuity plans) run uninterrupted. In such a scenario, the significance and relevance of the D2C model have been acknowledged universally.
Nonetheless, there are all-round hopes that, sooner or later, the pandemic will turn into an endemic disease, just like the seasonal flu. Thereafter, morbidity and mortality rates across the globe will drop drastically. But given the ongoing threat from successive waves and new variants, it is apparent that consumer brands will continue to be wary of any further disruptions in operations. Against this backdrop, brands have begun to reimagine their strategies to sustain supply chains while also deciding on the most practical business model in these circumstances.
Converting Adversity into Omni-channel Opportunity
However, as the saying goes: ‘Every dark cloud comes with a silver lining.’ Keeping this maxim in mind, nimble D2C brands have turned adversity into opportunity by customising marketing strategies as per the evolving consumer dynamics and the trend towards impulse buying. For D2C brands specialising in personal care items, there was an upsurge in sales during this period, particularly when the pandemic waves peaked. These sales were primarily propelled by consumers becoming more conscious of health and hygiene issues.
Once the pandemic abates across geographies, some of these sales could fall back to lower levels but are still expected to be higher than the pre-pandemic era. Meanwhile, market analysts believe some of these behavioural changes will prevail over the long haul as consumers now have greater awareness about their overall health and well-being. Additionally, consumers are most comfortable with online shopping as they have realised the tremendous convenience and speed that digital deals provide.
Moving forward, changes in consumer habits and purchase patterns mean brands and policymakers will need to maintain a sharper focus on maintaining inventory levels of goods while sustaining higher efficiency across supply chains to pre-empt unexpected disruptions. Companies and government officials also need to maintain regular communication channels with customers, reassuring them that adequate supplies are now available and there is no need to hoard items even if there is a temporary rise in coronavirus cases.
Coming back to impulse buying, it is important to make a distinction between the practice during normal times and in a crisis. In normal circumstances, festive sales, deep discounts and attractive offers on multiple occasions trigger impulse buying. On the other hand, when adverse events occur, consumers are quick to purchase groceries, medicines and many other essential products since they remain unsure about the longevity or severity of these circumstances.
Fortunately, events of the past two years have made FMCG and D2C brands aware of the criticality of diversifying supply chains to handle any abrupt surge in demand, more so in the case of essential goods. Furthermore, the recent events have highlighted the fact that they cannot depend solely on the traditional model of doing business during periods of unforeseen disruptions. Whereas D2C brands have always understood the importance of digital modes in reaching customers across the country, conventional players have also understood the message.
Deploying hybrid and omni-channel models is no more a matter of choice in catering to customers. Rather, it is a sound way to remain future-ready and competitive under all circumstances.