Baby boom and cautious spending are among the 12 top trends that will shape consumer behavior this year, according to a study.
Kantar, world’s leading data, insights and consulting company, has identified the top 12 trends that will impact how consumers navigate the new normal in shopping this 2021. These trends are baby boom impact, cautious spending, e-commerce expansion, leveraging omni channel, convenience and proximity, antibac, quest for immunity, bring the outside in, impulse at home, joys of pampering again, regionalizing of behavior, and sustainability.
Marie-Anne Lezoraine, general manager of the Worldpanel Division of Kantar Philippines, said that the top trends will affect consumer behavior as COVID-19 pandemic continues to influence the complexity of overall consumer behavior and mobility.
On baby boom impact, Kantar cited a by the University of the Philippines Population Institute (UPPI) and the United Nations Population Fund (UNFPA), the Commission on Population and Development (POPCOM) said nearly 2 million babies are expected to be born in the country this year. This baby boom will present opportunities for baby categories as well as the full repertoire of FMCG products, especially for new mothers.
Cautious spending will also affect consumer attitude where most households have cut their fast moving consumer goods expenditure to manage their budgets throughout the pandemic year. Based on Kantar’s Purchase Confidence Study in July 2020, 79 percent expressed worry about their financial situation.
Thus, Kantar emphasized value for money as the highest consideration as Filipino shoppers focus on making the most of their budget.
Online shopping remained nascent in the Philippines despite the disruption experienced by brick and mortar stores due to the pandemic. Based on its findings, only 8 percent of the population purchased FMCG products online in the latest year ending 2020. Yet this channel is undeniably growing, with 772,000 additional buyers, although it currently remains skewed towards higher SEC and NCR shoppers
To leverage this channel, Kantar said brands must not underestimate the differences in behavior and basket content of online vs offline consumers. E-commerce as a marketing touchpoint may also lead to offline purchases.
Kantar said that loyalty to one channel is almost non-existent as Filipinos continuously adapt their channel repertoire depending on their needs.
In relation to the 4th trend, Kantar’s study showed that each retailer holds a unique positioning.
Shoppers with limited mobility prefer proximity when visiting stores in their locality. Kantar noted that 9 out of 10 Filipinos prefer to shop in nearby stores, offering an opportunity for retailers to consider expanding in or close to residential areas.
Unsurprisingly, anti-bacterial products have been highly-relevant to Filipino households. However, as more and more brands leverage their virus-killing advantage, they would need to step up their game and combine this essential function with additional benefits.
In addition, the quest for health and immunity benefits of FMCG products is undeniable, according to Kantar. Brand growth is possible if they would be able to raise awareness on the health and nutritional value of their products to attract more Filipino consumers.
In 2021, Filipinos are likely to increase their mobility assuming quarantine restrictions across the country are eased. Filipinos may seek convenience and versatility as their lifestyles continue to evolve and brands must be able to adapt accordingly.
As such, reduced purchases last year that affected impulse categories are expected to continue this year. But easing of quarantine restrictions could help a slow but sustained growth in the purchases of impulse products.
The personal care category, particularly beauty products, were drastically deprioritized when the Philippines implemented the enhanced community quarantine in March 2020. Similar to impulse categories, Kantar expects that the new year would see the slow return of the Filipinos’ beauty routine.
This will still be subject, however, to improved mobility and the consumers’ aspiration for normality.
There have always been nuances in shopping behavior by region. With the pandemic evolving at a different pace, brands would need to keep a pulse on regional behavior and customize their execution of marketing touchpoints to reach consumers based in the NCR, Northern or Southern Luzon, Visayas or Mindanao.
Kantar, in its Who Cares Who Does Philippines 2020 report, found that 75 percent of Filipino shoppers seek out brands that offer ways to offset their environmental impact. Most importantly, consumers see it as the role of manufacturers to drive the sustainability agenda. Developing a sustainability strategy has become paramount for brands moving forward.
“The world continues to experience volatility and uncertainty due to the health crisis, and it is therefore, difficult to predict Fast Moving Consumer Goods (FMCG) expenditures,” said Lezoraine. “The nature of our quarantine restrictions and our confidence in enjoying any mobility drastically changes our behavior as consumers and shoppers,” she added.
Lezoraine added that the fundamentals of brand growth will remain the same in 2021 in that attracting the largest number of consumers and shoppers will remain key. However, achieving this will depend on any FMCG company’s ability to evolve with the times and the emergence of new consumer needs resulting from a stay-at-home lifestyle.
According to Lezoraine, these trends will not necessarily manifest in all shoppers nor will it be equal across all Filipino households. “It is important to identify key targets, prioritize them based on how valuable they may be for your business and activate it through the right pack, price and channel strategy in order to reach more consumers more than a year into the pandemic,” she said.