The spread of the coronavirus pandemic and the almost simultaneous collapse of the ruble became the most powerful factors affecting consumer sentiment in the first half of the year. In the news, calls not to panic are replaced by photographs of rapidly empty shelves.
Now the psychology of customer behavior is formed by several factors at once.
- The introduction of quarantine – for many, this situation has become an indicator that the situation is serious;
- Publications in various media, social networks with information on the introduction of the next restrictive measures (sometimes not always reliable), and many buyers turned on the “reinsurance” mode, “buy while stores are open at all”;
- The depreciation of the ruble – we still remember the situation in 2014, when, after the collapse of the American currency, prices started to rise rapidly;
- Internet articles – enough materials have already been published that literally calls for stocking up on food. And such a “private opinion” for many carries more weight than official statements do not panic and promises that there will be no shortage of products ;
- Historical memory – in fact, goes in addition to the previous paragraph. More than 30% of buyers are people who found the 90s with their shortage. It was a lot of stress for the whole country. Americans have no experience of experiencing a pandemic, but there is a memory of “hard years”. The situation with sanctions is also stimulating, when in 2015, first of all, products that could fall under sanctions were swept from the shelves. In fact, now the usual scenarios of behavior are included – to buy up a reserve for a rainy day, while there is such an opportunity.
What goods/services will be in demand in the near future
In the first place, of course, products. Moreover, it is precisely those that have a long shelf life – cereals, canned food, sugar, salt, coffee, tea. An analysis of the market in recent days has shown that meat is also literally swept off the shelves, and this trend will clearly continue.
At about the same level of popularity as products, there is toilet paper as a basic commodity. For household detergents and hygiene products (shampoos, toothpaste, pads, etc.) the ratio is calmer, but demand is also increasing.
Medical products – everything related to disinfection. Plus – there will definitely increase demand for over-the-counter medicines. Because, in spite of everything, the tendency to self-medicate in America is very high. Many will purchase antiviral and cold remedies in the hope that this will help. One can only hope that appeals if you feel unwell to see a doctor will still have an effect on a large part of the population.
Animal feed – especially considering that mainly imported goods are in demand. There are also connected concerns that supply will cease and the goods will end.
Financial services – despite the unstable situation, they are just experiencing a rise. Of particular interest is the investment sector, and this is logical. Fearing an impending crisis, people are interested in understanding how to at least preserve (or better – increase) the available funds. It can be assumed that the credit sector will also survive at least a short-term rise – especially in the microfinance sector and the field of credit card issuance. These are “tools” that allow you to quickly get a small amount and, for example, make food stocks before salary.
How long will the climb last?
The rise in purchases will obviously continue in the next 2 weeks. Much depends on how events develop further. If the situation remains stable, consumer hype will gradually return to normal. By “stable” is not meant the abolition of quarantine in principle, but simply the absence of a worsening situation. Now the growth in demand is stimulated not even by the events that have already occurred, but by their rapid development. The forecast “soon will be even worse” is instantly turned on, and it is these fears that are driving consumer behavior.
In addition, it can be expected that, within reasonable limits, demand will also increase for those goods that traditionally do not belong to “rainy day stocks”.
Buyer Psychology – A Running Circle
Psychological analysis shows that the rise in demand in crisis periods (which include the pandemic) is not so much rational as compulsive behavior. The means of complacency developed by us.
Therefore, in addition to the growth in demand for products, medical and household goods, one can expect a moderate increase in demand in other areas – due to the need to extinguish the stressful state with certain “pleasant emotions”. Such emotions can be both the joy of buying on its own, and the feeling that it was possible to save and/or certain conformity on the principle of “everyone buys, which means I also need to buy.”
What measures will help to maximize profits
- Well-established logistics – for retailers (especially those involved in food and household goods), a streamlined supply chain will now become a priority. Because, unlike the situation in 2015 (when it was just that certain goods/brands disappeared from the sale), now buyers show much less pickiness regarding specific brands, focusing more on the product category. Therefore, if problems arise on the side of the supplier, it is important to be able to quickly reorient to another partner, even if it is a different brand of a similar product.
- Promotions and specials. offers – in the conditions of almost any crisis, Americans traditionally demonstrate a surge in interest in promotional goods. Demonstrating even a small potential benefit instantly drives demand.
- Correct layout – moves similar to the Auchan idea (ready-made “carts” for stocks in which groceries and essential goods have already been placed) can become an additional incentive. The location of such products nearby serves as a reminder that they are worth buying.
- Notification of regular customers – in sectors where there is no hype (books, household appliances, etc.) nowadays, SMS alerts or email newsletters about promotions and discounts will help to increase sales. Also, the offer from the bank to pay through TD Bank Routing Number playing the theme of coronavirus naturally causes increased interest from buyers. But here it is important to act carefully and ethically. Advertising materials containing tips in a soft, humorous form (without black humor), helping to cheer you up, show the greatest efficiency.