Adapting to changes
Retailers and suppliers are slowly adapting to the changes brought by the new normal. Consumer behavior is becoming more unpredictable with each day that passes and categories, products, and brands could be affected for a long time.
Food retailers and CPG brands have seen an increase in sales during the pandemic. However, the food sector remains very competitive and if a company wants to survive and keep the market share gained during lockdown, it needs to take fast-efficient actions to supply demand, not only by offering competitive prices but also by providing customers with a unique and personalized experience.
Since the sanitary crisis started, technology tools that are able to deliver and measure the impact of campaigns in real-time have become essential for both CPG suppliers and supermarkets, making sure their investments are profitable. Technology tools able to predict campaign results, costs, delivery, and redemption ratio are essential for supermarkets and CPG brands to evaluate different scenarios and make the right decisions.
New consumer behaviors
The current crisis has changed consumer conventional purchases. Shoppers spend 37% more per grocery trip and compared to the early days of lockdown, the frequency of shopping has decreased for most consumers.
There are three different consumer buying groups responding to the new normal. The first are those that work from home but their income hasn’t changed, therefore, they expect innovations on size and prices. The second group corresponds to those whose salary has decreased and care more about value and variety. And lastly, the third group are those that have seen a significant decrease in their income and are choosing to buy groceries in supermarkets that offer the lowest prices.
Each group is willing to purchase products from that one retailer that meets their incomes and needs. But one thing they all have in common is that they spend more time at home and are becoming more sensitive to prices, therefore promotional coupons are the key when it comes to purchasing decisions.
What ‘s next?
With the purpose of surviving, food retailers need to optimize communications across all channels, analyze their product demand patterns, and focus their sales on the fastest-selling SKUs. In addition to that, enhancing shopping experience through coupons and loyalty programs must become a priority for retailers, especially in difficult times such as the current crisis we face nowadays.
It’s most likely that this shift to greater consumer experiences will continue to grow even after the sanitary crisis, and only those retailers that act quickly will survive.
Engaging with customers isn’t an option anymore, but the key to keep customers coming back. For this reason, food retailers should double down their efforts in delivering promotional discounts on products customers are really interested in through the channels the customers are responding to the most. This information should be available to the supermarkets from the customer data they collect through loyalty programs , which is why these will become even more important than they are today.
Big data essential to survive
During lockdown, many retailers were unable to connect with their customers due to the lack of information, becoming a great disadvantage for them. Efficient communication, big data, technology tools, predictable results, real-time customer insights, and other tech-enabled tools have become essential for retailers to survive in the market. We can see more and more retailers adapting to the new normal focusing most of their efforts on digitalization and technology. The best retailers are looking for technology platforms that help them boost their marketing efforts, for example by creating offers of products that consumers really need at the price they are willing to pay.
In short, the key to success is the ability to adapt to shifting consumer behaviors in response to the current crisis and reinforce business performance by using technological tools and big data.