Mixed Consumer Sentiments And Behavioral Shifts Post COVID-19 Causing Transformation In Retail Sector

The entire Indian Retail landscape seems to have been undergoing a tectonic and paradigm shift as COVID-19’s adverse effect has started impacting global economies with the onset of reduced demand and inevitable recession looming on financial horizon across the globe. The prevalence of social distancing and lockdowns has laid huge challenges with substantial long term changes being the new normal for the industry on the whole as well as on the consumer behavior The Indian retail segment even though was functioning and adopting certain innovative changes, customers along with market penetration have always been a focal point to build sustainable strategy for business growths However, with the outbreak of the COVID-19 pandemic, the whole semantics have collapsed, where the entire retail segment has been estimated to push back 5 years’ time and has been forced to adopt and implement strategies that would create more sustainable businesses.

Behavioral changes amongst consumers have always played a major role where the markets and the industry would base their strategies on. With the outbreak of the Pandemic the retail industry on the whole has seen numerous changes in consumer behavior where customers now prefer to shop online and maintain least contact or prefer contact-less shopping. According to the National Retail Federations survey about 9 out of 10 consumers have changed their shopping habits after the outbreak of COVID-19, while over 50% ordered products through online sources or mediums that they would earlier purchase from stores but now avoid it altogether due to fear of crowd and subsequent infection risk. The survey also highlights that 60% customers are actually worried of going to the store with the fear of being infected.

While the global pandemic has hit hard, customers have now moved their buying preferences of being minimalistic where they pick essential over leisure spending. While social distancing and home quarantines have been followed by customers, consumers fill in their carts both physical and on virtual platforms with essentials such as food and other necessities and not indulge in leisure spending. The Pandemic has made the customer more selective in their approach to purchase products. This has created a more positive impact on the retail grocery segment as more and more consumers turn to local groceries to purchase their products through online platforms. E-Grocery platforms have been doing the rounds as COVID-19 has instilled fears in the minds of consumers and they prefer to order groceries right at their doorstep and feel safe from the crowded place where chances of getting infected from the virus is significant. . According to an online source the average daily user rate on E-grocery platforms are to the tune of 40,000 during the global pandemic peak time period. As per the recent Google Trends the number of searches that are done on grocery delivery services has grown leaps and bounds.

There have been changing consumer sentiments and behavioral shifts amongst the consumers who primarily have mixed sentiments about choosing the channel of purchase. One must not forego the fact that the country has about 12 million independent Kirana stores that support the nation’s retail network. These stores still constitute to be the most preferred choice of the consumers in the neighborhood. While the E-Grocery retail platforms are trending amongst consumers one must not forget the fact that the segment of retail grocers has also been trending amongst customers. A recent survey states that 79% store owners in non-metros and 50% in metros feel that new buyers are now coming to their stores for essential products during post lockdown. While a segment of customers who preferred to purchase products and essentials from online grocery stores, one can see a transformation of Kirana Stores 2.0 where the stores have been introducing standardization and digitization for enhanced ease, convenience and accessibility for the customers near their neighborhood. Kirana stores have offered unprecedented ease and accessibility for years together for customers across all the segments due to their geographical penetration across all parts of the city be it in metros or urban areas or tier II and tier III cities. What is even more striking is that customers in the neighborhood can avoid longer queues due to the familiarity that is developed between the Kirana Stores and the regular customers visiting these stores. While smartphones and faster networks have been used by consumers, these platforms are also being used by the Kirana Store owners now to accept payments through digital mode.

From E-wallets to QR-Codes the retail industry surely has seen an overall digital transformation. But the choice of the channel of purchase still stays in the hands of the consumer. The preferences and the choices made obviously shall depend on the ease of availability, quality products and accessibility of the services offered by the channel and the sheer quality of the service delivered. The retail segment will see a huge transformation which is here to stay for a very long time and this can’t be termed as temporary by any means, rather it shall be considered to be a new normal.