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07/01/2021

Nailing consumer needs in the second half

As we enter the back half of the year, columnist David Orgel argues that retailers needs to be on point as the pandemic wanes to attract customers and inspire loyalty.
David Orgel
Principal, David Orgel Consulting
David Orgel profile picture

You may have heard about the British consumer whose mission was to park in all 211 spots at his local grocery store. It took six years, a lot of record keeping and shopping trips — including during the pandemic — to succeed. 

For those six years, his loyalty was pretty much guaranteed, but maybe not any longer as his long pursuit is over.

There’s a loyalty message in this for U.S. food and drug retailers. In the second half of this year, society is fully opening up as the COVID-19 pandemic wanes. Many consumers are feeling “done” with the pandemic. They are getting out more. They have more choices as retail and restaurant competition is increasing. The result is that shopper loyalty will be harder to come by. 

Retailers will need to be on target for customers more than ever. That is easier said than done. Here are some key insights to help achieve success.

Show Empathy
Shoppers may be getting out more, but that doesn’t mean it comes without anxiety. A survey from The American Psychological Association found almost half of Americans feel uneasy about adjusting to in-person interactions once the pandemic ends. 

Of course, everyone is different and attitudes vary by geography. But it’s not a stretch to say that a return to post-pandemic life creates anxiety for many. Retailers have an opportunity to welcome back shoppers who had avoided in-person trips. They can relay empathy in their messaging and engagement — “We’re so glad to have you back!” Or even convey humor — “We knew you couldn’t stay away from us much longer!” They can create enhanced in-store experiences and let shoppers know these are not to be missed. 

Watch the Puck
In the second half, it’s more important than ever to skate to where the puck is going — when it comes to consumer behaviors and spending patterns. A recent report from AlixPartners found the pandemic has driven permanent changes in the consumption habits of one out of two consumers globally.

That’s a lot of consumers. Retailers need to identify the changes and how these will continue to shift — because they will. The behaviors at issue will involve e-commerce, health and well-being at home versus restaurant meals and other crucial topics. 

Navigate Prices
A spike in consumer goods prices is creating a more complex landscape for retailers and consumers. Increases are driven by factors ranging from higher demand to disrupted supply chains. It’s not clear how long the inflation will last, but it will be an important factor in the second half. Surging prices impact a lot more than just food and drug retail, which means consumers may be more constrained in general on spending. 

Retailers can only hold back so long on increases if their costs are going up. However, they can strive to educate shoppers about price spikes and deliver value through other means, such as marketing programs. 

Understand Trade-offs
Retailers need to understand how competing motivations are playing out with consumers. For example, sustainability is a growing focus for many shoppers, but it can be trumped at times by other factors, such as convenience. 

A NielsenIQ Omnibus survey conducted this year found 61% of consumers polled want online shopping items delivered as fast as possible, while only 39% said they prefer having product deliveries consolidated in one shipment to reduce packaging and the number of delivery trips — even if the items take longer to come. An article about the survey in Progressive Grocer was titled: “E-Shoppers Pick Speed Over Eco-Friendliness.” 

The upshot is that consumer behaviors will be moving targets as time goes on. For the second half of the year, it will be essential to track where shoppers are headed — and I don’t mean which parking spots. 

More Blog Posts In This Series

  • Kroger’s retail school is now in session

    Columnist David Orgel writes about how the retailer, in response to the pandemic, is sharing best practices with all stakeholders — suppliers, employees, customers and even competitors — knowing that it will benefit the industry.
  • Steering retail to other side of pandemic

    This month, columnist David Orgel discusses the new late-stage and post-pandemic imperatives for retailers, including a need for disruptive retail experiences and unique industry partnerships.
  • Retailers aim for pitch-perfect sourcing

    This month, David Orgel discusses the various ways that retailers are finding suppliers to help innovate and offer the most relevant assortments.
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