How has consumer behavior changed during a pandemic
The changes caused by pandemic intervenes everyone without exception. The new government´s measures affectted our personal and professional life and the whole different areas of the economy.
Pandemic caused redundancies and, in some cases, also bankruptcies. The interventions to common living changed daily rituals and work from home has become a matter of course. We even changed our activities and products to use as before of the pandemic.
There are so many new trends in society which interest the masses, for example home baking bread, home exercises, meditating, gardening, homemade hairstyling and homemade manicure. The new situation required adaptation to the online world.
Growth in electronic sales
The Stackline agency made a ranking of segments which had huge growth of sales because of the pandemic. There are changes in segments we had no interest in and we had no idea we could buy these items online. The hygienic gloves are the winner in this case - there is 670% growth. (See in Diagram n. 1)
Graf č. 1
Online sales of medicines, home bread bakeries, exercise aids and home hairstyling sets significantly increased. Baring in mind we used to buy all these items in high street retail.
Nowadays we can buy almost everything on the internet. This fact has shifted the direction and caused new custom behaviour. We used to buy medicines, glasses, furniture, goods and we also brought many services to our homes. It is obvious that marketers had to adapt their marketing strategies to new demand which moved to online platforms.
The changes of sales behavior on Slovakia
Most Slovaks began to buy durable food, pastry, fruits and vegetables for a long time to come.
This trend has gradually subsided. After the introduction of new measures by the government the route and time of customers coming to shops changed. The customer now walks about a 15% longer route but about 20% quicker like before the pandemic. Which practically means that the customers take longer routes in a store, but they shop quicker.
We used to spend lot of time in a queue at the check-out, but after the introduction of new regulations which specified exact number of customers per square meter, the overcrowding of places lower down. If there is a queue, customers rather avoid the check-out areas as they are not looking to risk getting into crowded spaces. *1
The support of local products
The customers had to change their spending during the pandemic and about 43%of them stopped buying their favourite brands and began to buy more affordable ones, purely because of their changed financial situation. This is one of reasons why some chain stores are trying to support local products through their own brands. *2
What are we interested in when it comes to shopping? Well, taking the current situation in to consideration we are more interested in information mentioning country of origin on the packaging. Many of us prefer to shop locally or at least in shops where we can get majority of Slovak goods. We have realized that this way we cannot only rely on safety and quality (as the products do not travel cross-border) but also is the natural way to support our economy.
The online shopping
According to surveys, the online shopping of grocery goods used to use about 23,5% of Slovaks and this number went up to 37% during last year. One third of the online shoppers represent customers in the age between 25 to 34.The smallest group of online shoppers are people over 65 years old – which represents 13% of the total.
We used to touch and smell different goods during shopping, but now we prefer more safe shopping. Slovaks now spend less money per 1 shopping; however the frequency of shopping is higher. In comparison to the online shopping where we used to spend from 100 to 500 euros per on shopping. *3
According to the World Economic Forum, even though the number of customers who began to buy grocery goods online went up we still spend most of our money buying clothes, sportswear, household goods and electronics. *4
Growth and development of electronic sales is a worldwide trend and customers more often buy goods using their mobile devices such as phones or tablets. This fact is also supported by surveys and statistics on eMarketer. According to these statistics the mobile shopping rate grows every year.
The contribution of shopping via mobile devices formed 52,4% in 2016. The experts estimate that this number will go up to 72,8% this year, which represents almost a third of total e-commerce sales.
Shopping via mobile apps are three times more popular than usage of classic websites. Mobile apps are more user-friendly also when it comes to the final payment. The customers using those apps show to be more loyal to the brand which obviously brings different benefits to retailers.
If you want to run a successful online business, you will probably have to adapt different parts of your eshop to create smooth customer journey and comfortable shopping using all different platforms – mainly apps and website.
Graf č. 2
Breakthrough in payment methods
The pandemic has changed customer behaviour when it comes to payment methods. The most common method of payment in Slovakia used to be mainly cash and customers used to frequently withdraw cash from an ATMs.
Closed shops and restrictions in personal contact were the main reason why customers started to use more credit and debit card payments. During pandemic Slovakia has entered the new era where first time contactless payment dominated over a cash transaction. Even after lockdown when the shops have reopened, the number of cash payments haven’t got back to the same level of usage. *7
In the fourth quarter of 2020, Mastercard made a survey, which resulted that 46% of respondents started to pay cashless. The main being the effort to save time at the check-out.
During spring special restrictions, the cash payments went down by 14%, cashless payments went up about 20%, the number of payments with mobile devices has increased by 4% and the usage of online banking method went up by 6%. More than half of Slovaks claim that for them is imporatnat to make a payment quick and cashless and almost 48% share an opinion that cash payments should be cancelled completely. *8
There are many ways how to pay cashless in Slovakia. The most common are contactless cards but we really got use to pay using our smart phones and smart watches.
Google Pay launched the first service of this kind in 2018 when it enabled mobile payment on android. Afterwards, many brands followed and other payment methods like Fitbit Pay, Garmin Pay and Apple Pay appeared. Banks in Slovakia expected that mobile devices payments will become more and more popular, but during the pandemic this trend has accelerated significantly. *9
The mobile payments in Slovakia are mostly implemented by Apple Pay or Google pay. The data of Slovenská Sporiteľňa showed that payments with mobile devices are more and more popular for Slovak customers. Consumers who tried to pay by mobile phone once, often get quickly comfortable as it is quick and effective way, therefore they also restrict the use of payment cards.
While in second year of 2019 , mobile payments represented 3,7% of total cashless payments, in 2020 we are looking at 7,8% increase. Customers appreciate they do not have to carry they wallet around and in case they lost their phone they can immediately and easily block the card via bank´s website. *10
Pandemic has changed our customer behaviour and moved us into to he online world. Businesses which adapted have been during those times closer to customers then ever. Some of the changes in customer´s behaviour will probably never go back to its pre-covid status. On the other hand, the IT sector pushes the limits further and further everyday which is making our life easier.
It is really important for each salesman or marketeer to think about whether the business they run has adapted enough to this new world, as now would be the time to jump into online world and start to use its benefits.
Michaela Šikulová, Monika Hrdličková
*2 https://wwws svetbaleni.cz/2020/08/21/pandemia-posilnila-poziciu-privatnych-znaciek-na-slovensku/
*10 NBS https://www.nbs.sk/sk/blog/iveta-behunova/pandemia-urychluje-zmenu-nakupneho-spravania-slovakov