6 ways COVID-19 will change the way we live: Part 2

As the world is slowly moving out of lockdown, consumers everywhere are changing the way they live and behave. The ongoing social distancing measures and the presence of the virus means consumers have to adapt to the ‘next normal’ and their expectations for different sectors are changing. In this two-part series, our analysts from the UK and US explore what short, medium and long-term impact COVID-19 will have on six different industries in their markets. In the first part, we explored the changes we can expect in Leisure, Food and Drink and Technology. In the second part, we spotlight changes in retail, furniture and beauty.

Associate Director – Retail & Apparel, Diana Smith – How COVID-19 will change Retail (US)

COVID-19 will have a lasting impact on the way people view themselves and their external worlds. Everyone has endured some level of change to their lifestyles which has created new habits and new realizations about how they want to live in this world and where they want to focus their energies. People will learn to live in a more conscious way. This of course includes how and where they shop.

Prior to the pandemic, shopping behaviors were largely automatic and routine, motivated by unconscious needs such as saving time (convenience) or saving money (value). These will always remain key drivers of shopping behavior but consumers will more strategically consider what convenience and value means to them in the context of their personal safety. Consumers will embrace shopping options that make them feel safe, such as curbside pickup and appointment-based shopping, while some will shop online more for items they previously would’ve never considered buying online (eg. groceries, furniture). They will seek out retailers that offer contactless delivery and cashierless payment systems.

Beyond these tangible motivators, consumers will also think more strategically about where they want to shop and who they want to support with their money. This will be based on how retailers demonstrate their values and convictions, and the role they play in giving back to the greater good. 

Online will become the preferred way of shopping

Source: Digital Marketing Institute

Consumers are developing a renewed sense of awareness about social issues that matter to them and they will look to support retailers who lead with conviction and share the same values. They will also boycott companies that don’t, even if it means sacrificing value and convenience. COVID-19 has changed every person and how they behave. Consumers will view retailers not merely as places to conduct transactions, but as places to express their newly honed selves, beliefs and values.    

Retail Analyst, Marco Amasanti – How COVID-19 will change Furniture (UK)

Given its often higher price tag, the furniture market will be at the forefront of COVID-19 disruption in home retail, and of the drop in non-discretionary spending more broadly. At least in the shorter-term, the impact of this will be double-ended: on one hand, the market will be hit by a suppressed appetite for big-ticket purchases, and on the other hand, given its greater need for in-store assurance, furniture will be disproportionately impacted by store closures and ongoing risk on the high-street.

Nonetheless, there will be avenues for growth within this landscape. Extended periods inside will continue to push home furniture up the agenda for non-essential spending. In fact, as of April 2020, over half of consumers agree that the lockdown has made them prioritise the home over other things. Accordingly, although total expenditure amounts will drop in the coming year, this will offer opportunities at the lighter-end of the market; and particularly for decorative pieces and storage solutions. However, the greatest such avenue will be in office furniture, sales of which will surge in 2020 as millions are forced to work, and to care for and teach their children, from home. Mintel’s latest research indicates that nearly a quarter of consumers had already increased spending on office furniture as a result of these shifts. With space at a premium for many Brits, this will no doubt drive the need for multi-purpose furniture solutions and temporary workspaces.

Demand for home office furniture will keep growing

Source: Discover Fashions

In the longer-term, this disruption will have a profound legacy impact on the way that consumers shop for furniture. Unsurprisingly, with a recession now likely, there will be a renewed focus on value and a return towards savvier shopping habits. However, the most stark shift will be in the surge online penetration within the category, as the redirection of a great deal of demand effectively fast-forwards furniture retailer’s online strategy by years, underpinning a wave of advancements in ecommerce for years to come.

 Senior Global Beauty Analyst, Lauren Goodsitt – How COVID-19 will change Beauty (US)

Amidst the existent and future threat of COVID-19, beauty brands are working to both protect and progress their products by repositioning, reinventing and innovating. They are adjusting to current consumer realities through the introduction of new claims, leveraging their accessibility through online platforms, displaying sentiments on comradery in marketing messages, and utilizing education to instill confidence in their brands.  

Over the past few years, authenticity has played a major role in the beauty industry. Brands that are succeeding in today’s environment are not adopting completely new personas as a result of COVID-19; rather they are rewarding loyal customers with exclusive access to promotions and or offering virtual consultations. This method shows both their immediate and long-term commitment to their consumers. Additionally, as consumers navigate this difficult time they are looking for ways to support their communities and each other. Beauty brands that pair purchases with an easy opportunity for consumers to give back (i.e. supporting frontline workers) stand out among the crowd and will be seen in high regard well into the future.

Virtual beauty consultations will become more common

Source: Women’s Wear Daily

Lastly, beauty consumers have and will continue to have safety concerns. Prior to the pandemic, product safety dealt with ingredients and clean formulations. Now, the topic of safety has evolved. While consumers continue to scrutinize ingredient lists, they are also watching the way that beauty brands and retailers evolve their safety practices. The treatment of staff, sanitation of stores, contactless collection and accessibility of e-commerce shopping will all affect consumers’ views of beauty brands and their shopping habits well beyond COVID-19.