As the financial year ended on 31st March, there were 1 million cases worldwide of novel COVID- 19 and around 3000 in India alone. The human race faces an unprecedented challenge, one never seen in this form before. But just like SARS, Zika and MERS there is no question of “If” the curve will flatten, but when?
The longer we take to answer this, the more severe the implications will be, not just on human lifestyles but businesses, economies and health.
While the global economy was in a precarious situation even before the onslaught of COVID- 19, it is now imminent that we are heading towards an erratic global recession. This is largely because the lockdown has resulted in the shutting of business operations and disrupting the supply chain. This demand shock has made companies cautious & discretionary of their spendings. Many countries have already induced stimulus packages to stabilize the cash flow and increase purchasing power.
The Indian economy was in a turbulent zone and this shock will have ripple effects for a long time to come. While we are focused on immediate damage control by providing relief packages & containing health hazards, it is important to mitigate the long-term shocks as well. With imports & exports markets severely hit, there are going to be anomalies in sectors like health and safety, supply chain, labor force, cash flow, consumer demand, and marketing. But getting above this is not just about surviving but also thriving. Digital disruption began before the pandemic world but is accelerating at a high pace with the lockdowns. Essential product industries are facing shortage with panic buying, and many have taken this opportunity to become front runners of the game. Digital disruption in grocery saw a hike soon after the lockdown. Moving towards an uncertain future, the post-pandemic world looks like it’s going to be filled with surprises and unpredictability.
New Consumer Temperament.
The exhaustive home-arrest phase will make consumers wary of their spending and comfortable with digital shopping. Consumers have resorted to make-do with available resources, thus making them spend scarcely. Working from home, subscription to online classes, breaking free from take-aways and cooking at home, shopping online for essential items are just a few habits that are likely to get permanent even after the lockdown. This will change the demand of certain goods & services in the post-pandemic state of the world.
Changing Retail Landscape
There was a significant transition to digital commerce before the advent of COVID- 19, but the acceleration is not good news for many retailers, including grocery stores. Digital disruption in grocery would mean consumers will refrain from impulse buying and have precautionary discretion in new product trials. All this coupled with delivery & package costs will not be profitable to many retailers.
Additionally, in the post-pandemic world, consumers will be cautious and less receptive to crowded places, public tools, samplings, food bars, buffets, etc. This germophobia will make consumers prefer bulk shopping over their mobile phones & laptops. This makes it imperative for retailers to leverage technology and introduce new touch shopping trends.
Global Recession & Economy Downtime.
As recession looms over the horizon, consumers are bound to become conservative, limiting their purchasing power. However, need-based categories will see an upward trend, and emerge as winners. But as the traffic for other retailers will go down, with the existing inventory- there might be a need to join hands to sail through the storm. The high retail costs, competing e-retailers like Amazon, Flipkart and the entry of couture’s like Zara, Forever 21 and H&M have already made it difficult for BnM retailers (in fashion) to make a profitable business. Independent retailers are likely to consolidate to meet the lack of demand & continue operations.
There are going to be challenges & uncertainties and as such, it is imminent to make the right decisions to meet demands and stand out as a brand to gain trust.
