In the new COVID-19 reality, there has been an onslaught of unwelcome changes that we’re still trying to adjust to. How, when, and where products are being consumed, produced, and distributed has a massive impact on the nature of these changes. Never before has the categorization of essential versus non-essential goods and retailers been considered. From this conversation, a new set of categories has been established, including new essentials—which refers to emerging customer needs brought on by massive shifts in daily life.
One of the most obvious effects of the COVID crisis and the resulting lockdowns has been the rapid acceleration of ecommerce and disruptions to the customer journey. So, how can brands transform these challenges into opportunities to enhance their digital experience? We have identified several aspects of the customer journey for each category that need retooling for our new reality.
Essential Goods and New Essentials
Essential goods are the products that have a significant impact on peoples’ daily routines. Most of the time it is the essential goods that often go unnoticed. How frequently, before this, did we think critically about where one would get tampons, milk, eggs, and aspirin? However, these are the items that are used most often and will be the first things consumers look for when assessing their readiness the next time there’s an emergency.
In contrast, new essentials represent products that would traditionally be considered non-essential. However, the new normal has also resulted in a new set of consumer needs that toe the line between the two existing categories. Retailers that fall under this category are facing many of the same challenges described in the essentials category and should be addressed similarly. Examples of new essentials include things like health and fitness, housewares, home improvement, and toys and hobbies.
What challenges do essential goods retailers face in the COVID-19 world?
First, the crisis has exposed issues with product availability due to a drastic increase in demand for some products. These issues are founded upon, among other things:
- A monumental decrease in brick-and-mortar footfall
- Supply chain disruptions
- The need to provide customers with safe options for pickup and delivery.
A few must-take steps have emerged. For example, essential goods retailers need to ramp up their data capabilities by using up-to-date data delivery and analysis to manage supply chains and product demand. If a firm has been waiting to invest in this step, now is the time to move. Myriad upsides await. Leveraging data to provide customers with real-time messaging, for example, will help manage expectations and build trust with customers. This type of data can also provide increased efficiency and help to prepare the organization to better respond to future roadblocks.
Essential and new essential goods retailers should also consider:
- Using UX design to drive enticing sales journeys to products. Employing specific UX interventions can guide customers to in-stock items and help them plan for delays, as can using specific “COVID pain points” to rethink standard ecommerce functionality like filtering (for example, filter by ship date or availability).
- Taking advantage of increased need for messaging to connect with customers and further establish brand voice and values. Effective digital engagement can help to communicate messaging around new safety protocols, as well as cause-driven marketing and social outreach.
The non-essential goods category includes a much wider range of products and therefore has a more diverse set of challenges as well as potential opportunities. This category includes everything from luxury handbags to hotels rooms and big-screen TVs. Many retailers speciaizing in these products will have to pivot their offering and value proposition to better accommodate the post-COVID customer.
Challenges for non-essential goods retailers include:
- Physical retail location closure
- Disruption in some omnichannel strategies (at-home could replace the in-store)
- Economic downturn resulting in less disposable income and less revenue
- Potential missed seasons and surplus stock
- Previous marketing programs and campaigns no longer relevant
Opportunities for non-essential goods retailers include helping customers contend with economic instability by providing them with additional purchasing support. This is especially relevant when it comes to larger purchases—increased financing options (including ease of use) can help customers plan for these types of purchases and alleviate some of the anxiety around financial commitments.
Loyalty programs will also need a refresh. Take travel rewards cards: people can’t use them and, after the pandemic ends, everyone will likely still travel less for a while. Redesigning the loyalty program to promote and reward behaviors outside of the buying cycle might be the best approach when it comes to non-essential purchases.
How else can brands connect with customers to ensure loyalty when financial strain is alleviated? As with essential goods, relevant content designed to nurture customer relationships is imperative at this time. Not only should this be reflected in the brand’s product messaging, but it should show up in specific community-driven support programs. These programs should replace more-superficial marketing efforts that are no longer viable, like pop-up events and in-store promotions.
For more on connecting with how your customers are feeling, and what you can do to help, read my previous article, “Let’s Meet Where We Are.”