Lockdown, Shake Up: The New Normal for Shopping in Europe

Increasing importance of personal health

Personal health and wellbeing were already top-of-mind for urban consumers before the COVID-19 outbreak. Almost half of European consumers have included more plant-based foods into their diet and have reduced their intake of substances like gluten, dairy or sugar. The importance of health and diet has increased since the outbreak of the pandemic. More than 60% of European consumers are now more focused on mental health and wellbeing, as well as on physical health and fitness.

This trend provides retailers with motivation to broaden their portfolios of health and wellbeing products, to rearrange the way they position products in stores and online, and to reconfigure their pricing models. Even if a significant share of consumers plan to reduce their overall spending, the willingness to buy hygiene and health products is unchanged.

Like consumer goods manufacturers, retailers must also think about new marketing channels and formats if they want to further develop their businesses in the health and wellbeing sector. Social media channels, and especially collaboration with influencers who represent health and wellbeing topics in an authentic way, can boost awareness and sales.

Non-contact shopping

Online sales have grown significantly in the first half of 2020, especially for daily-use products like groceries, toiletries, pet supplies and pharmaceuticals. Even after the social distancing rules became less strict, online demand for fast-moving consumer goods remained significantly higher in the second quarter of 2020 than it was in the same quarter of 2019. This trend will persist. Consumers appreciate the convenience and safety of online shopping, and also work from home more often – which means they are available to receive deliveries.

COVID-19 has given retailers the final push to make their omni-channel businesses work, to understand what their customers really want and value, and to offer an outstanding customer experience throughout the customer purchase journey. In our consulting practice, we have seen that online retailers continued to invest in optimising their organisations and systems during the pandemic. They will emerge from the crisis even stronger than before. For this reason, the push for companies to adapt will have a greater force on retailers who have traditionally operated offline businesses.

Almost half of European consumers (49%) have been shopping in stores less frequently since the outbreak of the COVID-19 pandemic. Due to high standards for hygiene and safety, many consumers still avoid going on extensive shopping trips. However, in-store technologies can help to bring consumers back into stores by creating new forms of customer experience, strengthening customer loyalty, and integrating new hygiene and safety standards.

Even before the outbreak of the pandemic, European consumers valued new technologies in stores. Automated checkouts (34%) are one of the most important features for enhancing the in-store shopping experience, followed by personalised offers sent to the customer’s smartphone when they enter the store (29%), and in-store aisle navigation (21%). In particular, young consumers and consumers who do daily “microtrips” to grocery or drug stores expect time-saving checkout solutions. Health concerns and social distancing rules have amplified the need for non-contact shopping in stores. Use of contactless payment has increased since the outbreak of the COVID-19 pandemic, even among German consumers who have adopted mobile in-store features more slowly than other European consumers. For retailers, automated checkouts and contactless payment options are no longer an additional nice-to-have customer service – they are a clear must-have.

Conscious consumption

In times of crisis, health and financial security top the list of important topics for consumers in Europe. However, we are convinced that sustainability will remain a key factor in purchasing decisions – and will become even more important. Before the pandemic, European consumers were particularly conscious about avoiding plastic and reducing packaging. The focus on the use of plastic is likely to decrease because hygiene requirements have become very important during the pandemic.

However, during lockdown, consumers have had time to reflect and have realised that they need much less and that they value different things than they did before the pandemic. Many European consumers face the need to reduce their spending due to a decrease in household income during the crisis, and they will be even more conscious of what and where they buy. Even before the outbreak, consumers had clear expectations for how retailers and consumer goods companies should operate. 43% of European consumers expect companies to be accountable for their environmental impact, and one quarter of consumers take sustainability aspects into consideration when shopping – including environmental and social responsibility, and transparency about the origins of a product. Consumer goods manufacturers and retailers need to take sustainability very seriously and actively differentiate themselves to create consumer loyalty and advocacy.

At the same time, the pandemic has stressed the importance of sustainability at the interface of health and compliance. Traceability of product origins and transparency about business practice have become key factors for sustainable and resilient supply chains. European consumers mainly hold governments responsible for encouraging sustainable behaviour. The European Union’s Green Deal initiative, as well as several local government programmes, are driving the implementation of sustainability standards throughout global supply chains and increasing the accountability of retailers and consumer goods companies.