Save more, spend less to be shoppers’ new mantra, says Nielsen survey

Save more, spend less to be shoppers’ new mantra, says Nielsen survey thumbnail
People wear mask during shopping at a grocery shop amid rising cases of COVID 19 cases in New Delhi. (Photo: ANI ) 4 min read . Updated: 18 Apr 2020, 12:39 AM IST Suneera Tandon, Shuchi Bansal About 64% of consumers say they plan to spend less on restaurants and movies over the next few…

People wear mask during shopping at a grocery shop amid rising cases of COVID 19 cases in New Delhi. (Photo: ANI )

4 min read

. Updated: 18 Apr 2020, 12:39 AM IST

Suneera Tandon, Shuchi Bansal

About 64% of consumers say they plan to spend less on restaurants and movies over the next few months

NEW DELHI :
Shoppers are likely to cut back sharply on discretionary spending after the lockdown, sacrificing outings to malls, restaurants, and salons to save up for immediate needs such as health and hygiene products.

About 64% of consumers say they plan to spend less on restaurants and movies, according to market research firm Nielsen. Consumers have stocked up on essential goods such as packaged rice, wheat and soap, Nielsen said in the second edition of its report on the impact of covid-19 on fast moving consumer goods and retail.
The online survey was conducted by Nielsen between 10 April and 14 April among 1,330 people in 23 cities.
The future is tilting toward home-cooked meals rather than eating out. People are cooking more at home and making healthy food as they are staying at home, said Sanjay Mishra, chief operating officer, Marico India, which makes Saffola cooking oil and oats. Hygiene has also become a big issue with increased awareness and is likely to remain the trend once the pandemic is over, probably affecting eating out initially.
“Brands will have to work harder to earn the trust of their consumers while continuing to be relevant to their needs,” said Pizza Hut’s director of marketing, Neha, who uses only her first name. “At Pizza Hut, deliveries will continue to see an uptick and we are geared to handle that surge with technology upgradations, oven-to-home contactless processes, and delivery-centric value deals. Subsequently, we are confident that dine-in will pick up as consumers will look forward to the sheer delight of eating out,” she said.
Even if normalcy returns and the lockdown is relaxed, people will not be comfortable in crowded places, including airlines, restaurants, clubs, and metros, said Sameer Shukla, west market leader, South Asia, Nielsen Global Connect. “How various service providers cater to this ‘new normal’ in terms of providing these goods and services in a hygienic and controlled environment will be future opportunities for brands,” he said.
In the Nielsen survey, 43% people also said they will defer spending on fashion, personal grooming and home décor. Surprisingly, 54% plan to decrease spend on automobiles, a category otherwise expected to do well post covid-19 as consumers take steps to avoid using public transport and shared cabs. This is because of the climate of economic uncertainty, said Shukla. The same percentage of respondents also said they will spend less on luxury products and leisure travel.
In a behavioural shift, consumers are willing to spend more on personal hygiene and safety products, with 56% of respondents saying they will increase spends on healthy, organic food, medical needs, fitness and medical insurance.
The importance of preventive healthcare will grow in consumer priorities because of the covid-19 pandemic, said Dabur chief executive officer Mohit Malhotra. People are expected to turn to more immunity boosting, personal hygiene, and nutrition products, he said.
A spokesperson for Hindustan Unilever Ltd, which has acquired brands such as Horlicks and Boost, also said that it will leverage the “mega trend of health and wellness” in India.
The month of March saw a spike in the sale of hand sanitizers by 340% over the December-January-Feburary period. The hand wash category grew by 60% and floor cleaners by 24%. As per the Nielsen report, the sale of branded honey in modern trade outlets grew by 35% in March, Chyavanprash by 81% and turmeric by 38%. Interestingly, the survey findings show that more people hope to increase their spends on online purchases, with 39% saying they will increase online shopping by 20%, a finding that augurs well for the e-commerce companies.
E-commerce has seen exponential growth and this will continue, said Prasun Basu, president, South Asia, Nielsen. In the last decade, the share of traditional trade (kirana stores) had gone down from 94% to 88%, he said. However, after the coronavirus outbreak and the ensuing lockdown, kirana stores have made a comeback.
“Yes, e-commerce, on small base, will grow well. So will modern trade, which has seen good growth in the last few months. However, the world will definitely be run in a major way by traditional retailers and kirana stores that will be able to satisfy the needs of consumers,” said Basu.
Nielsen expects a lot of innovation coming in the traditional trade model. For instance, MaxWholesale, a B2B e-commerce platform for kirana stores to source online inventory has launched an app that allows consumers to get in touch with their kirana stores and local retailers. The hyper-local app Radius allows kirana stores to share their catalogue with the neighbourhood, connect with their customers to receive orders and payments.

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