YS Learn: What can the new consumer behaviour shift mean for startups and businesses
According to a recent study by market research firm Kantar, close to 72 percent of Indians have been economically impacted by the COVID-19 pandemic, while 52 percent said they are financially worse off than they have been in the last year.
In fact, about two-thirds of Indians seemed cynical if the situation will get better at all, the report said.
However, it also added that the new Indian consumer is looking for different things, including security, safety, and healthcare. In a conversation with YourStory, Hemant Mehta, Managing Director, Insights Division, and Chief Strategy Officer, Kantar South Asia, spoke about the new Indian consumer behaviour, and what it means for startups and businesses.
Hemant Mehta — a consumer behaviour and media observer for the last 25+ years in India — has seen and tried to cope with continuously evolving consumers and media panorama.
His expertise spans a wide range of product categories, large-scale, and complex continuous measurement projects. He is a regular speaker and has also authored and presented papers at various industry fora.
Edited excerpts from the interview:
YourStory [YS]: How would you define the new Indian consumer?
Hemant Mehta [HM]: The new Indian consumer is a cautious consumer, who is worried in terms of health and personal finance. What they are seeking is security, assurance, bonding, and privacy.
This is also a consumer who is adaptive to the changes around her, as well as quite accepting of the new innovative solutions. This could also be more out of compulsion than choice.
YS: What are the changes you see in consumer behaviour, and which sectors are growing because of this change?
HM: One of the biggest changes we saw in consumers is the shift towards online and greater acceptance towards it. The current crisis has brought some major shifts in consumer behaviour in terms of managing their health and wellness and satisfying their entertainment needs. However, limited mobility has impacted their brand choice.
Categories that are set to grow are those offering wellbeing, convenience, and home improvement. Moreover, discretionary and luxury categories will see a slowdown as consumers have become more careful in spending only the essentials.
YS: What will the new world look like? Will the consumption patterns be both online and offline?
HM: While there is a definite tilt towards online shopping — this is more so for categories around technology, health, and education — offline will continue to be strong for essential categories, with the majority of consumers, in fact, claiming they have a deeper connection with their regular kirana stores.
However, we do see some apprehension towards physically visiting modern trade stores. A lot of traction will also depend on the product offering – consumers are looking for offers and the best value for their purchases.
YS: What are the behavioural shifts in Tier-II and III India? How does that impact the overall tech landscape?
HM: The crisis seems to have impacted Tier-III more than metros and Tier-II cities. Besides the pandemic, one of the other factors that have impacted them is the postal economy. Because of migrants, that typically come from lower-tier and rural regions, there is increased pressure on the economy in these tiers.
YS: What is the overall outlook for 2021?
HM: Our survey shows the consumer is anxious, and their outlook for the next six months is of worry and concern — both their personal finance, and how the economy will shape up in the years to come. This is more so for the older generation; Gen Z shows more optimism than the other generations.