It is well-known that a person in crisis tends to make impulsive and intuitive decisions. The COVID-19 pandemic also brought to fore several aspects of crisis behaviour among consumers. A recent Nielsen report on consumer behaviour during the lockdown demonstrates that an average consumer's consumption decisions have been overpowered by emotional and intuitive decisions. For instance, when the country entered into a lockdown in March, there was news of shop shelves becoming empty as consumers had started hoarding essentials for a rainy day. Hoarding is a classic example of crisis behaviour when the consumer is coping with the fear of uncertainty. "During times of uncertainty and stress, a person is governed by emotions and finds it difficult to think rationally," explains Supriya Shashidhar, Executive Director, South Asia (Consumer Insights Qualitative), Nielsen.
During a crisis, the human brain has limited cognitive resources which impacts attention and working memory. The brain processes less general information and is only receptive to things pertaining to the current situation. Hygiene and immunity have been the biggest concerns during the COVID-19 lockdown, and consumers have especially been receptive to any information related to hygiene and health. This has reflected in impulsive purchase of products such as sanitisers, handwash and floor cleaning products. Manufacturers have also capitalised on this trend of heightened consciousness for hygiene and strengthened their portfolios of hygiene products. While the likes of Hindustan Unilever and Godrej Consumer increased production of sanitisers and handwash, companies such as Marico, Dabur and P&G forayed into the segment. The month of April, according to Nielsen, saw the entry of over 150 hand sanitiser brands, many of them being local brands.
Apart from hygiene, there has also been a tendency to buy food and beverages which have a nutrition quotient. Products such as Protienex, Horlicks and Bournvita have not been easy to find at the neighbourhood grocery stores nor on e-commerce platforms as there has been a tendency to hoard these products. Brands are already capitalising on this trend by launching immunity boosting products. Dairy major Amul has launched Haldi Milk and Tulsi Milk, while ITC Foods and Amway have partnered to launch B-Natural Plus, a range of immunity boosting juices.
The Nielsen report says that consumers during a crisis pivot towards what is familiar and prefer to stick to brands and products they have been using for a while. During normal times, a Colgate user may be open to experimenting Patanjali's Dant Kanti toothpaste just because a friend would have suggested to try it out, but during crisis, the tendency is to stick to tried and tested brands. "Because of stress, decision-making is impaired and one isn't in re-evaluation mode. One is therefore dependent on mental short-cuts," explains Shashidhar.
However, the supply chain and distribution crisis, especially during the first few weeks of lockdown, has put consumers in a no-choice kind of a situation wherein they had no choice but to get whatever was available. As distribution improved, consumers have moved back to the brands they are used to.
The coronavirus crisis has also led to new habit formation, disrupting old habits that a consumer had formulated over years. One of the obvious new habit that one acquired has been to stay indoors. While going to a mall during weekends and watching a movie with family was a habit for many prior to COVID-19, the lockdown has forced people to stay indoors, cook a nice meal at home and get entertained by watching a show on an OTT platform. These new habits, according to the Nielsen report may persist unless strong cues are given to revert to old habits.
"If malls and multiplexes are able to reassure consumers that they are taking all possible measures to ensure that their properties are safe, only then consumers are likely to revert to their old habits," says Shashidhar. In fact, many movie producers have already started capitalising on the changed consumer habit of increasingly consuming content on OTT platforms by releasing their films on these platforms. Fashion retailers such as Raymond and Arvind Brands are talking about sending e-catalogues to their consumers and enabling them to close the sale without having to visit their stores.