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How brands can tap into the new consumer mindset – by Criteo’s Alistair Burton

By Alistair Burton, Country Manager MEA at Criteo

The coronavirus pandemic has changed the way we shop. As physical stores remain closed in the wake of a lockdown, consumers are turning to e-commerce for anything from groceries and essentials to home wear. Criteo, for instance, has seen an increase in sales among retailers that sell home goods, consumer electronics and health products.

According to Kantar’s Global COVID-19 Barometer in March, 20% of consumers globally said they shop less in physical stores, with nine percent saying they do more of their shopping online. But a more recent study by the same company showed that the share of consumers that do more than half of their total purchases online in the UK, France and Germany, has increased with between 25 and 80 percent since the outbreak of COVID-19.

These are signs that we could be looking at a transformed retail sector in the aftermath of the COVID-19 pandemic. A.T. Kearney’s Global Retail Development Index, which was released before COVID-19, revealed that economic development and trade policy remain the largest factors in shaping retail growth in consumer markets. The study showed that the UAE remains a resilient retail environment with an overall growth rate of 3-4%. The study also showed that government-led economic reforms, a digitally-connected consumer segment, and growing purchasing power, are together enabling the next wave of retail development and growth in the region.

Is this likely to change in the next few months? It depends on how retailers choose to respond to the situation. Many are still taking the time to understand the impact that the pandemic is having on their business and the ecosystem as a whole. In order to weather the storm that lies ahead, they must be prepared to engage with a new consumer mindset. It is now perhaps more important than ever for retailers to be customer-centric, and focus on consumers’ specific coronavirus-related concerns. Consumers will remember how brands treat them during this time, which is crucial in fostering loyalty once social distancing ends.

Technology has had a tremendously positive impact on the retail sector in the last few years and will play a key role in how retailers can stay relevant during these uncertain times. Even before the pandemic, mobile web-based purchases in the region have been on the rise. According to Criteo’s Global Mobile Insights Report for Q2 2019, retailers who promoted an App benefited from App-based mobile purchases, including Apps and the mobile web. Brand or retail websites were also more likely to be a shopper’s first stop than Amazon or Google – even when the consumer hadn’t settled on a specific item yet.

Apps have also been gaining in importance, driven by massive adoption among Gen Z and Millennials. Furthermore, rising mobile penetration has encouraged more retailers to launch their own Apps. Brands that don’t yet have a mobile App would do well to consider it now, as it is an important platform to connect better with the younger generations.

When it comes to in-store purchases, retail/brand stores had become a source of immediate fulfilment with proximity and urgency driving shopper visits. However, in light of a global lockdown, people have become accustomed to shopping from the comfort of their homes, and it would be interesting to see how this develops once the situation returns to normal.

In a pre COVID-19 world, shoppers valued different aspects of online and in-store shopping.  Given that many shoppers are turning to retail or brand websites for product discovery and research during this critical time, retailers are under enormous pressure to ensure that shoppers get value for the time they spend on their site.

This means that when shoppers visit their site, now more than ever, they want to see the most relevant deals and discounts based on their interests and previous browsing behaviour. Retailers must therefore help their customers by demonstrating thought leadership and focusing on what matters to them, by reaching the right people with the right message at the right time.

Looking ahead, creating convenient App and mobile web experiences will ensure that brands are top-of-mind for shoppers who are spending hours online. In markets such as the Middle East, where mobile usage is high, this could help retailers reach out to their customers where it is most convenient for them, as they adjust to the new normal.

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