T urn the Tide - Boston Consulting Group · 2020. 8. 18. · Inflation / Price Indicators8 •70 bps drop in CPI •130 bps drop in WPI Web Traffic trends Internet peak traffic saw

June 2020

Turn the TideUnlock the new consumer

path to purchase

Deep-dive: E-Commerce

Turn the TideUnlock the new normal

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d.Consumer behavior

has fundamentally changed

The new normalhas transformed the purchase pathway

Businesses must unlock the new normal to help

revival


Facebook company

Great [leaders] rejoice in adversity just as brave soldiers triumph in war

—Lucius Annaeus SenecaCovid-19 is a global pandemic

However to win in the current situation, companies need to tailor strategies to today’s unique context and look through layers


Despite this pandemic, signs of recovery are starting to show

India gradually moving towards opening up economy3 ; E-commerce unrestricted for all categories from Lockdown 4.0

Industry1.0

25 Mar

2.020 Apr

3.04 May

4.018 May

Education offline

Travel & tourism1

Public transportation2

Fashion, luxury & other retail

Other services

Auto and components

Building materials

Construction/infra

Consumer durables & discretionary

Forest products

Chemicals

Machinery

IT services

Goods transportation & logistics

IT hardware

Metals & mining

Packaging

Industries unrestricted (across all lockdowns)

Media

Energy & utilities

Oil & gas

Financials

Insurance

Education (online)

Consumer staples

Food/drug retail

Pharmaceuticals

Health services

Telecom

Agriculture

Fully restrictedPartially

restrictedUnrestricted

Based on guidelines released on 17 May

Lockdown stages

Pandemic spread in different degrees across the globe

Note: Continued cases and fatalities are subject to different testing, propensity, reporting standards and hence imperfect measures 1. . [NDTV Corona Virus - Live Statistics Data - accessed on 22nd June, 2020] 2. [BCG Analysis - No. of doubling days based on 7 day CAGR, Source: John Hopkins CSSE data] 3. [Ministry of Home Affairs (MHA) - Do not apply for containment zones, States and Union Territories may prohibit certain activities , BCG Analysis]

China

India

USASpain

France

JapanIran

South Korea

UK

Brazil

Russia

Italy

As of 22 June 2020

~8.9MConfirmed cases globally1

188Countries with cases1

Total no. of cases1

~0.42MRecovered1

~0.23MActive1

~0.17M

0-3 days

3-6 days

6-14 days

14-30 days

>30 days

As

of

05

Ju

ne,

20

20

Day

s o

f d

ou

blin

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ses2

As of 22 June 2020


COVID-19 Cases0.42M+ total cases in India1

Web Trends~120% spike in online searches on health & immunity in India post COVID2

Demand of health products49% consumers intend to buy more vitamins, herbs and supplements in the coming days3

Market Sentiment Indicators10:20% decline in Nifty index since 1st Feb

Income Uncertainty• 60% of total household expenditure in

hotspots; 45% of consumption in hotspots non-essential6

• 198M workforce employed in hotspot districts7

Trade / Logistics Indicators9: • 35% decline in exports and

29% decline in imports• 14% decline in retail freight traffic

Inflation / Price Indicators8

• 70 bps drop in CPI • 130 bps drop in WPI

Web Traffic trendsInternet peak traffic saw 40% rise in March in India15

The pandemic has impacted the socio-economic fabric of IndiaRapid acceleration of E-commerce adoption expected with consumers avoiding stepping out to shop

Public Health Measures Social distancing enforced via nation-wide lockdown

Industry Guidelines Major categories for E-commerce (eg. Consumer electronics, durables, apparel and CPG) in unrestricted category as per latest government guidelines4

Monetary Relief Measures ~$13Bn infusion by monetary relief measures by RBI5

4

5

6

Consumer Sentiment ~140Mn+ online shoppers in India11;Consumers showing higher propensity to spend on online channel even for traditionally offline categories12

11

Mobility40%+ reduction in number of visits to public places due to lockdown and social distancing16

13

Media, Smartphone Usage 16% increase in smartphone screen time (May vs Pre-COVID)13

Globally, ~3Bn average MAUs across Facebook, WhatsApp, Instagram & Messenger14

12

14

Consumer priorities being re-calibrated; certain behavior changes

will stick long term

HEALTH & SAFETY PUBLIC POLICY SOCIALECONOMICAL

10

7

9

8

Uncertainty around income and weakened demand potential in near

term

Social distancing and structural interventions will drive faster recovery

The pandemic has created a never-before focus on health & safety

1

2

3

Source: 1. [NDTV Corona Virus - Live Statistics Data - accessed on 22nd June, 2020] ; 2. [Online Search Trends (India)] 3. [BCG COVID-19 Consumer Sentiment Survey, April 30- May 03 (N = 1,327)] 4. [Ministry of Home Affairs (MHA), Govt. of India; Do not apply for containment zones, States and Union Territories may prohibit certain activities] 5. [RBI Notification – 17th April] 6. [BCG Analysis, Source: Nielsen-Indicus database 2017-18, Hotspot list as of 15th April (MoHFW), data compiled in 2017-18 , Press Search] 7. [BCG Analysis, Source: Hotspot list as of 15th April (MoHFW), PLFS workforce survey 2017-18, Census 2011-12 district workforce report] 8. [CPI (MOSPI), WPI (Office of economic advisor) – Change comparison Feb 20 vs March 20] 9. [Import-Export movement (Ministry of Commerce & Trade), Railway Traffic (Ministry of Railways) – YoY decline in March'20] 10. [Bloomberg data - As of 23-April] 11. [Source: Forrester Report; Forecasted for 2019] 12. [Source: BCG COVID-19 Consumer Sentiment Survey 13. [BARC Nielsen – TV + Smartphone consumption report during COVID, 7th May 2020] 14. [Facebook Q1 2020 Earnings Release/ Call Transcript – 2.6Bn users just on Facebook] 15. Press Search [News18] [Internet Traffic in India Sees 40% Spike in March Due to COVID-19 Lockdown: ACT Fibernet] 16. [Source: COVID-19 Community Mobility Report – India – Apr 17, 2020]


‘Social distancing’ has been the key to fight disease globally and in India; making it the new way of living

Social distancing advocated as key measure to control COVID spread

India is actively following social distancing guidelines

India has observed a stark drop in number of visits across public places

This is reflecting in consumers preferring digital for buying and payments to avoid disease vectors like cash and POS3

Reduction in number of visits compared to baseline

RETAIL & RECREATION

Reduction in number of visits compared to baseline

WORKPLACE

~85%2 ~65%2

Globally strict measures followed to ensure social distancing

Hong Kong

South Korea South Korea keeps social distancing post COVID-19

Hong Kong extends social distancing measures as cases drop

10+Closed publictransportation1 19+

Closed workplaces1

Countries Countries

-qz.com

-Bloomberg

CDC

Johns Hopkins University

1. [Oxford COVID-19 Government Response Tracker] 2. [COVID-19 Community Mobility Report (April 17, 2020) - The baseline is the median value, for the corresponding day of the week, during the 5-week period Jan 3–Feb 6, 2020]; 3. Press Search 4. CCI Consumer sentiment survey

Up to 15 April 2020

~40-50%4

Consumers expect to increase E-com spendin next six months

~45-50%4

Consumers increased usage of digital payment options during lockdown


18% of Indian companies1 improved both growth & margin during the 2008-09 Global financial downturn, while 37% declined in both2

Globally, companies have weathered historical downturns and emerged victorious by recognizing opportunities3

Even in challenging times, historically there are organizations that have found opportunities to grow

ExpandingEBIT margin

ShrinkingEBIT margin

Increasing sales growth

Falling sales growth

18%21%

24%37%

A

B

Launched C2C marketplace Taobao in 2003, driven by consumer behavior changes due to SARS; propelling Taobao on a path of 17 years of continuous growth

3-5times

3-5 X Growth in listing of new B2B businesses on Alibaba in 2003 compared to pre-SARS rate

Overall, Alibaba grew from 400 employees in 2003 to 100,000 in 2020

ALIBABA GROUP

17 years of

continuous growth

~$430 Bn GMV (Taobao)

1. [Indian public companies with Market Cap > $10M, excluding Banks, Insurance, Asset Management companies] 2. [BCG Analysis: Based on revenue growth & EBIT Margin growth (from FY'09 to FY'12) compared to three-year pre-downturn baseline (from FY'06 to FY'09); Source: S&P Capital IQ Financial Statements] 3. [Press release, expert interviews; BCG analysis, Statista]

25 states have less than 20% active cases1

Very High : >=10% of pan India cases

Med : <3% of pan India cases

No cases

High : >=3%, <10% of pan India cases

Andaman and Nicobar Islands (0)

Karnataka (3177)

Chandigarh (39)

Delhi (17712)

Haryana(2681)

Kerala(1175)

Maharashtra(44384)

Punjab (482)

Rajasthan(2513)

Uttar Pradesh(4320)

Uttarakhand (684)

West Bengal(4743)

Chhattisgarh(848)

Tamil Nadu (15416)

Telangana (1803)

Andhra Pradesh (2031)

Puducherry (75)

Odisha(992)

Ladakh (50)

Gujarat(5309)

Jammu and Kashmir (2916)

Madhya Pradesh(2688)

Bihar(2672)

Himachal Pradesh (189)

Goa (263)

Manipur (214)

Mizoram (41)

Assam (2107)

Jharkhand(730)

Tripura(646)

Meghalaya (22)

80% cases

Data as of 09 June

Dadar Nagar Haveli (20)

Nagaland (115)

Sikkim (7)

Arunachal Pradesh (50)

Companies should strategically prioritize re-opening and scaling up business as lockdown starts easing across regions

Potential to target specific micro-markets further along recovery to 'normal'

1. [BCG Analysis, Source: Ministry of Health & Family Welfare (MoHFW) website; Press reports]


As we move towards recovery, near term potential exists in pockets; need to look at the de-averaged picture


Spending sentiment translating differently across categoriesEssential categories have more positive outlook; mixed sentiment for electronics and discretionary spends

Right strategic actions needed to win disproportionate share Marketers will need to identify pockets of opportunities

Daily essentials

At-home entertainment

Saving/ Investments

Health

Education

“Growing” CategoriesCategories with net increase in spends

Fresh foods

Staples

Household care products

Personal care products

Utilities (electricity, water)

Mobile services

Home wifi connection

Paid OTT subscription

DTH services

Toys & games

Savings

Insurance

Preventive diagnostics/test

Vitamins, herbs, supplements

Medical procedures

First-aid

Education

23-26th Mar 30 Apr-03rd May

Wave 1 Wave 317-20th Apr

Wave 2 'Shrinking' CategoriesCategories with net decrease in spends

Vacation/leisure travel

Business travel

Public transport

Spas, theme parks, concerts

Restaurants

Movies at cinema hall

Non-mobile consumer electronics

Mobile electronics

Scooters/bikes

Cars

Travel

OOHEntertainment

Electronics

Auto

23-26th Mar 30 Apr-03rd May

Wave 1 Wave 317-20th Apr

Wave 2

Consumer sentiment Positive Neutral Negative

Home Home construction/renovations

Luxury brands/products

Cosmetics, makeup, perfume

Apparel/fashion

Tobacco & smoking supplies

Alcohol

Food delivery

Sports equipment & clothing

Packaged food & beverageDiscretionary

spends

Home furnishings and décor

Note: Question text: “How do you expect your spend to change in the next 6 months across the following areas?” Categories with Top 2 Box > (5% more than average) classified as winning categories. Categories with Bottom 2 Box > (5% more than average) classified as losing categories. Categories neutral across waves: Baby/children's food, Non prescription medications, Prescription medicines, House rent, Home purchase & Home loans. Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively)


E-Commerce in India was still small but growing fast among major economies

Opportunity for increased penetration across all categories

33% CAGR; higher than other major markets

10 14 1824

31

2015 20192016 2017 2018

+33%

Value ($B)

25%

Driven by 2.6Xgrowth in number of online buyers in India (2015-2019)

(CAGR 15-19(E), %)

14

31

7

2

1

2

2

1

2

Appliances

Apparel & Footwear

Other

Consumer Electronics

CPG - Food

Media

CPG - Personal Care

Homeware

Total

% of online sales

w.r.t total retail

sales (2019)

Segment-wise split of online sales (In $ Bn – 2019)

30%

6%

7%

9%

26%

4%

2%

54

143

2015 2019

# of online buyers (Mn)

75% by GMV

0.3%

4%

27%

Significant opportunity for growth across

categories to meet global benchmarks in

online penetration

4%

Overall online

sales penetration

Source: BCG Analysis; Online Retail Forecast Forrester report (Includes the purchase of merchandised goods and services. Does not include travel and hotel categories. Excludes other services, digital media spend and other financial transactions. Online retail sales in China and India include both business-to-consumer (B2C) and consumer-to-consumer (C2C) sales; 2019 values as per Forrester forecast; Consumer Electronics includes Computer hardware and software, Consumer electronics and smartphones; Food refers to Grocery;

Pre-COVID, E-commerce in India was small but growing fast


India now expected to have 300 Mn+ online shoppers by 2023

COVID-19 has accelerated E-commerce adoption in India by 2-3 years

Estimated number of online shoppers in India (In Mn) – Post-COVID vs Pre-COVID

140-150 Mn online shoppers in India today

Pre-COVID, India was expected to have 300 Mn online shoppers by 2025; In the aftermath of the pandemic, number of online shoppers likely to reach 300 Mn by 2023

0

100

200

300

400

2019

375-400

50-60

2015 2023 (F)

140-150

280-320

240-260

300-320

2025 (F)

Pre-COVID

Post-COVID

Source: Forrester report, Expert interviews and BCG analysis


THIS PANDEMIC HAS DEEPLY

IMPACTED THE MIX OF

BOTH ONLINE BUYERS AND

CATEGORIES BOUGHT

ONLINE



Estimated spend in $Bn

(2019)2

How the pandemic has impacted the spend pools# of consumers in Mn (2019)1

Online spend of online buyers

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• Pool will increase with new adopters and wallet deepening

• Higher need for friction-less experiences with growing digital maturity

~$30 Bn

Offline spend of online buyers

• Online share of wallet will grow as propensity to spend online for traditionally offline categories increases

• Need for contact-less convenience will drive growth

$75-100 Bn

Offline spend of digitally

savvy but non-online buyers

• Forced adoption of online shopping driven by lockdown; early trends show high likelihood to continue

• Overall growth in digital maturity will create comfort for online shopping

$275 Bn+400-420 Mn

140-150 Mn

Increase in online spend

Consumers will increase

their online spend

(includes both new and

existing online buyers)3

40-50%

Online spend pool will grow

Different consumer spend pools have opened up for online to tap

1. On a base of 540-570M Internet users 2. On a total base of $852bn in India (2019) ; Source: Forrester Report, BCG Analysis; Excludes travel and hotel categories, services, digital media spend and other financial transactions; 3. Question text: “In the next 6 months, how do you expect your online spend for the following types of products to change?”; Source: BCG Analysis - BCG COVID-19 Consumer Sentiment Survey (India), April 30-May 03 2020, N=1327


55% 60%

39%52% 51% 46% 43% 47% 44%

51%

31% 25%

31%

38%29%

32%31% 27% 34%

28%

Apparel/ fashionMobile phones Packaged food

& beverages

Consumer durables Personal care

products

Home appliances Household

care products

Cosmetics,

makeup, perfume

Fresh foods Staples

Same More than usual

% consumers expected to increase/ retain online spend in next six months

High onlinepropensity

Historicallymoderately online

Low onlinepropensity

40-50% consumers expect to increase online spend, even for traditionally offline categories

Note: Question text: “In the next 6 months, how do you expect your online spend for the following types of products to change?”Source: BCG Analysis - BCG COVID-19 Consumer Sentiment Survey (India), April 30-May 03 2020, N=1327


29

4436

31 31 33 30

5245

48 4849

20 21 18 21 19 19 21

Metro

50

18-25 yrsSEC A

35

Non-Metro26-35 yrsSEC B 36-45 yrs

% may increase spends on online channel (6M) % may decrease total spends on online channel (6M)% may spend the same on online channel (6M)

% of consumers looking to increase / decrease / retain online spends in the next 6 months – Demographic profile1

45-50% consumers across all age groups are planning

to increase spends on online channel

Similar trends across both SEC A and SEC B

consumers with positive / neutral sentiment

towards online spends

Similar trends in increased online

spending propensity observed for both

metro and non-metro cities

For select categories like mobile, apparel and food affluent consumers have higher affinity to spend

For select categories like cosmetics & consumer

durables older consumers (26+) have a more positive

spending outlook

High willingness to increase online spend observed across all demographic segments

Note: Question text: “In the next six months, how do you expect your online spend on the category X to change as compared to before lockdown?Source: BCG Analysis - BCG COVID-19 Consumer Sentiment Survey (India), April 30-May 03 2020, N=1327


11%

18%

24%20%

28%

21%24% 23%

28%26%

Mobile

phones

Home

appliances

Consumer

durables

Apparel/

fashion

Personal

care

products

Cosmetics,

makeup,

perfume

Household

care

products

Packaged

food &

beverages

Fresh foods Staples

With higher need for social distancing, consumers preferring contact-less purchase

Non-availability of other channels during lockdown for certain categories

Key drivers for new adoptionNew online buyers as a % of total online and offline buyers (Post-COVID)1

% of new online buyers likely to continue post lockdown2

100% 91% 90% 88% 82% 83% 86% 78% 82% 80%

1. Q . Which statement best describes your behavior about <category>? 2. Q. You mentioned that you have started online purchase of <category> since the Lockdown. How likely are you to continue purchasing” Source: BCG Analysis - BCG COVID-19 Consumer Sentiment Survey (India), April 30-May 03 2020, N=1327

Surge in new adoption across categories; new online buyers likely to continue20-30% new online buyers across most categories; 80 -90% likely to continue



As traditionally offline spends move online, higher need to resolve erstwhile barriers with new models

% urban consumers

Lack of touch and feel 40% Need to check product quality 35%

Better prices offline 25% Immediate need for product 28%

Immediate need for product 11% Easier return & other benefits 15%

% urban consumers

45%

43%

40%

37%

35%

32%

39%

32%

40%

40%

41%

39%Conversational

Commerce

O2O

Traditional

E-commerce

Livestreamed

selling

Social group

purchase

Video purchase

Trends from China indicate consumers will be eager to try new online models incorporating the positives of offline

More Same

% of consumers planning to spend more / same on

emerging E-commerce models5

% urban consumers

26%Immediate need for product Easier service/ repair online 34%

Difficulty in returns 17% Difficulty in returns 27%

Easier service/ repair online 13% Immediate need for product 20%

% urban consumers

New online shoppers across categories will expect their traditional barriers to be

solved even in their online journeys

Illustrative

Pre-COVID

Top reasons for not buying select category online

Pre-COVID

Pre-COVIDPre-COVID

1. Q. Could you please tell me topmost reason why you chose to buy mobile offline?, Source: CCI Digital Deep Dive 2016 (N=450), BCG CCI Digital Influence 2017 Study (N=18,000), Nielsen 2017 survey (N=1845); 2. Q. Could you please tell me top 3 reasons why you chose to buy large appliances offline; Only top 1 rank considered for analysis; Source: CCI Digital Deep Dive 2016 – Among digitally influenced large appliance buyers (N=560), BCG CCI Digital Influence 2017 Study (N=18,000), Nielsen 2017 survey (N=1845) 3. Q . Could you please tell me top 3 reasons why didn’t you buy this category online? Only top rank considered for analysis; Source: CCI Digital deep dive 2016 – Among digitally influenced apparel shoppers (N=501), BCG CCI Digital Influence 2017 Study (N=18,000), Nielsen 2017 survey (N=1845) ;4. Q. Could you please tell me top 3 reasons why you chose to these categories offline; Only top 1 rank considered for analysis; Source: CCI Digital deep dive 2016 (N=502), BCG CCI Digital Influence 2017 Study (N=18,000), Nielsen 2017 survey (N=1845); 5. Source: BCG CCI COVID-19 Consumer Sentiment Survey 2020, April 23-26 and May 8-10, 2020 (N = 2,779 and N = 2,884 respectively, unweighted, representative within ±3% of Chinese census).

Fashion3

<35 yrs, male, non-metro

Food & Grocery4

<35 yrs, male, non-metro

Mobile1

35+ yrs, female, non-metro

Durables2

35+ yrs, male, non-metro


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To win a share of this growing opportunity, imperative to understand the most fundamental change from COVID: Change in consumer behavior



The pandemic will create different types of changes in consumer behavior – some

more long lasting than others

REVERSAL OF PAST TRENDS

ACCELERATION OF EXISTING TRENDS

NEW HABITS

Wild cards; likely to be temporary surges

These are complete reversal of how consumers were behaving in the past

These changes have mostly risen out of a constraint or fear vs. convenience or choice

These trends will likely last in line with recovery period

High potentialpermanent shifts in behavior

Consumer behavior was already moving towards these trends

With the pandemic, the trends have gained momentum and accelerated

Positive reinforcement is essential for consumers to adopt them in the long term

Stickiness of change is yet to be determined

Entirely new habits developed during the pandemic and while social distancing

Consumers who gain positive reinforcement out of the habits may retain them

Ecosystem facilitating and feeding these changes can make it last longer

Remote way of living

Superior hygiene & clean living: a new norm

Trading down & bargain hunting

Shopping for Utility

Strive for Health & Wellness

Embracing digital services & experiences

Accelerated adoption of e-commerce & O2O

7

6

5

Income Uncertainty

Health & Hygiene

Social Distancing

3

4

11

9

Wild cards: likely to be temporary surges in line with recovery period

High potential permanent shifts: linked to positive reinforcement


Bringing the Outside Inside

1

Rise of 'Smart shopper'8

Trust in brand above all else

2

'D'o 'I't 'Y'ourself10

New trends of consumer behavior emerge across categoriesThis will deeply impact purchase pathways in the new normal



NEW HABITS

THE PURCHASE PATHWAY FOR CONSUMERS IS UNDERGOING FUNDAMENTAL CHANGES ACROSS CATEGORIES

UNDERSTANDING THIS WILL BE KEY TO TAP EMERGING OPPORTUNITIES


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In Summary:Mobile


8 consumer trends will have a higher impact on the Mobile category






Rise of 'Smart shopper'



8

6

5

Income Uncertainty

Health & Hygiene

Social Distancing

3

4

2

1 9





16% higher time spent on smartphones vs pre-COVID5

70% of those with a positive spending outlook on mobiles likely to stick with the brand in

mind in the near term3

1 in 2 of those who plan to increase spends on mobile are expecting discounts/offers1

5-10% increase in salience of functional purchase triggers4 for mobiles

55%6 smartphone buyers used online research pre-COVID; this is expected to

increase

55% intend to increase spends on

mobile phones in online channel in the next 6 months2

94% use mobile phones while watching TV7

70%4 urban consumers for mobile expected to be digitally influenced



NEW HABITS

1. [Q. “Please state the reason to spend more/ less in near future?” Source: BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020, N=1,327] 2. [Q. “In the next 6 months, how do you expect your online spend for the following types of products to change?” Source: BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020, N=1,327] 3. [Q. “In the next 6 months, how do you expect the choice of your brand to change" (for those increasing spends) Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, N=2106} 4. [Expert interview and BCG analysis] 5. [BARC Nielsen – TV + Smartphone consumption report during COVID, 7th May 2020] 6. [Percentage of the smartphone users; BCG CCI Mobile consumer study, N=2000] | 7. [GWI, All Internet Users 18-45, Coronavirus Research | April 2020 Multi-market research wave 2 and Core Research Respondents on COVID-19 from Q1-Q4 2019]


5-10% increase expected in salience of functional purchase triggers for mobiles1

8-10% increase in replacement time in the near-medium term for mobiles1

~70%1 urban consumers for mobile expected to be digitally influenced post COVID; up from 55-60%2 pre-COVID

55% smartphone users researched online pre-COVID3; expected to increase

40% of consumers planning to decrease spends will buy a cheaper variant4

~23% consumers chose features in top 3 choice drivers pre-COVID; expected to increase5

~16% increase in screen time spent on video streaming post-COVID; leading to increasing need for higher video stability etc.6

70% consumers with positive spending outlook likely to stick with brand choice already in mind 7

Online share for mobile phones (in value terms) likely to reach

45% in the next 2 years1; up from 38% pre-COVID9

Lack of product experience before buying has been one of the key barriers to online purchase 8

With social distancing, consumers will want to limit store visits for after-sales service

Higher need for at-home or virtual post sales service

Certain features related to in-demand use cases may become more important

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ASE

Higher average replacement time in near-medium term

Salience of digital influence for mobile will rise even more

With social distancing, importance of online research to increase

With a value seeking mindset, importance of pricing as a choice driver to go up

With changing use cases, consumers will be more feature conscious

With higher value consciousness, functional triggers to become more important

Uncertainties due to pandemic may lead to some consumers experimenting less

Affinity for online will accelerate even more

1

2

3

4

5

6

7

9

8

11

Consumers will expect positives of offline along with safety and convenience of contact-less purchase10

CONSUMER BEHAVIOR CHANGES IN MOBILE PATH TO PURCHASE

1. [Expert interview and BCG analysis]; 2. [BCG CCI Digital influence Study 2017 , N=18,000, BCG CCI Mobile consumer study, N=2000 and BCG analysis] ; Data for urban consumers shown 3. [Percentage of Smartphone users; Source BCG CCI Mobile consumer study and BCG analysis, N=2000]; 4. [Q. “In the next 6 months, how do you expect the choice of your brand to change” (for those decreasing expenses) Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, N=2106]; Data shown for urban consumers; 5. [Considering average of Rank 1-3 responses. Q: “Thinking about your most recently purchased mobile phone, can you tell me the 3 most important factors which helped decide what product should be bought?" Source: CCI Survey , N=840]; 6. [BARC Nielsen – TV + Smartphone consumption report during COVID, 7th May 2020] 7. [Q. “In the next 6 months, how do you expect the choice of your brand to change" (for those increasing expenses); Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, N=2106 ] ; Data shown for urban consumers; 8. [Q: "List of statements read out for 4 channels and asked to choose which channels are applicable to each of the statement"; Source: CCI Survey, N=840] ; Data shown for urban consumers; 9. . [IDC India Mobile Phone Tracker ; % by value]

In Summary:Apparel

7 consumer trends will have a higher impact on the Apparel category









5

4

3

Income Uncertainty

Health & Hygiene

Social Distancing

1

2

7

6




Consumer want retailers to focus on high standards of store hygiene post the pandemic (57% globally)6

79% consumers are unwilling to go out of house, except work5; higher need for casual / comfort in wardrobe vs social occasion clothing

55-60% urban consumers expected to be digitally influenced4

40% of consumers are planning to increase online spend on apparel7

32% consumers are planning to trade down in apparel1

40% of consumers planning to increase spend will expect discounts/ promotions during apparel shoopping2

Purchase triggers expected to become more "functional" vs. occasion led ; 15% consumers shopped due to functional reasons pre-COVID3; expected to rise significantly

1.4x rise in time spent on fitness apps8; increase in demand for activewear/ athleisure



NEW HABITS

1.. [BCG COVID-19 Consumer Sentiment Survey, Question: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively)), 2.[BCG COVID-19 Consumer Sentiment Survey, Question Text: “Please state the reason to spend more/ less in near future?” , Source: BCG COVID-19 Consumer Sentiment Survey, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. [CCI Survey and BCG analysis, Question Text: Occasion/reason for your last purchase in given apparel subcategory?, N=1218],4. Estimation for 2021 from expert interviews and BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year),5. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus? Combined Strongly agree and somewhat agree", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 6. BCG COVID-19 Consumer Sentiment Survey, April 17–20, 2020 (N = 5,729 across China, Germany, Italy, UK, and US; unweighted), 7. [BCG COVID-19 Consumer Sentiment Survey, Question Text:" In the next one month, how do you expect your online spend Apparel/ fashion (e.g., clothing, handbags, footwear) to change?”; April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively)), 8.[Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]


Casualization of wardrobe and higher demand for comfort with a more “stay-at-home” lifestyle

Given increasing focus on health and wellness, there will be higher demand for fitness wear

With more time online, digital influence will rise for apparel shoppers

Shopping triggers will be more functional as opposed to being led by occasions

Some consumers will seek attractive pricing or may trade down in choices

Core need for peer recommendations in apparel shopping may be fulfilled digitally, with growing virtual connect

Surge expected in preference for online apparel shopping

Consumers will expect higher standards of hygiene as they return back to stores

Consumers will need feel/fit/social experience along with a new need for contact-less convenience in shopping

CONSUMER BEHAVIOR CHANGES IN APPAREL PATH TO PURCHASE

1

2

3

4

5

6

7

9

8

41% consumers shopped apparel due to celebratory reasons pre-COVID1;

likely to decrease with 57% consumers having stopped or reduced going out to meet friends10

40% of consumers planning to increase spend will look for discounts2

With 79% consumers unwilling to go out of house except work, casual wear expected to become a larger part of wardrobe3

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1. [CCI Survey and BCG analysis, Question Text: Occasion/reason for your last purchase in given apparel subcategory?, N=1218]; 2. Question Text: “Please state the reason to spend more/ less in near future?” , Source: BCG COVID-19 Consumer Sentiment Survey, April 30-May 03 2020; 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus? Combined Strongly agree and somewhat agree", April 30-May 03 2020; 4. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]; 5. Estimation for 2021 from expert interviews and BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year); 6. BCG COVID-19 Consumer Sentiment Survey, April 17–20, 2020 (N = 5,729 across China, Germany, Italy, UK, and US; unweighted); 7. [BCG COVID-19 Consumer Sentiment Survey, Question text: "Which statement best describes your usage behavior since the Lockdown?] April 30-May 03 2020; 8. BCG-Facebook Fashion forward 2020 report; 9. [CCI Survey and BCG analysis, Question Text: Which of the following sources of information influence your decision the most for purchase of apparel?, Source: CCI Survey and BCG analysis]; 10. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus?", "Which statement best describes your behavior since the Lockdown?", Source: BCG COVID-19 Consumer Sentiment Survey, May 18-May 23 2020

Consumers are becoming increasingly health conscious; 1.4x increase in time spent on fitness apps4

57% consumers globally want retailers to focus on high standards of store hygiene, once the lockdown is over6

40% consumers are planning to increase online spend on apparel7

1 in 2 consumers rely on peer reviews and recommendations9

40% consumers cited lack of touch and feel as a key barrier to online apparel shopping, pre-COVID8

~55-60% urban consumers for apparel expected to be digitally influenced post the COVID; up from 45-50% pre-COVID5

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In Summary:CPG- Food

Fresh FoodStaplesPackaged Food

Income Uncertainty

Health & Hygiene

Social Distancing



NEW HABITS




2.7x rise in viewership of cooking recipes owing to home cooking1

1. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]; 2. [BCG COVID-19 Consumer Sentiment Survey, categories considered: Fresh Food, Packaged F&, Makeup, Staples, Personal Care, Home Care & Baby Care, Question text: “ In the next 6 months, how do you expect your online spend for the following types of products to change?”, April 30-May 03 2020; 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "In the next one month (CPG) how do you expect the choice of your brands to change?”; April 30-May 03 2020 ; 4. BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020; 5. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How do you expect your spend to change in the next 6 months across the following areas?”; April 30-May 03 2020; 6. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020; 7. [Online Search Trends (India), 2nd week of Feb to 4th week of April]


1


2


3


4


5

Remote way of living6

'D'o 'I't 'Y'ourself

7

65%+ consumers are planning to stick to the choice of the same brand3

28% consumers are planning to trade down4

80% consumers who have purchased food related sub -categories online during the

lockdown are willing to continue2

49% consumers to increase spend on Health & Wellness products5

52% consumers have increased use of social media;

more product discovery on social media e.g. recipe videos, food reviews6

100% spike in online research of "how to" trends7

7 consumer trends will have a higher impact on the CPG (Food) category

Fresh Food

Staples

Packaged Food


Consumers will look for buying avenues which provide contact-less convenience while fulfilling their core needs of familiarity and immediacy

Surge in demand for specific products/variants with an increased focus on health, hygiene, and wellness

Consumers will trade up in staples and selectively trade up /down in packaged food owing to a more value conscious, yet quality focused mindset

Changes in basket with a more at-home, do-it-yourself lifestyle

CONSUMER BEHAVIOR CHANGES IN CPG (FOOD) PATH TO PURCHASED

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2

3

4

31% consumers planning to trade up across staples and packaged food;

while 28% are planning to trade down in packaged food1

2.7x rise in viewership of cooking recipes owing to home cooking2

Post purchase advocacy will continue to be important; digital will be a powerful medium P

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49% consumers to increase spend on Health & Wellness products3

1 in 2 consumers relied on Word of Mouth for first online purchase in CPG pre-COVID; expected to be fulfilled digitally5

45+% consumers planning to increase

online spend in the next 6 months; 40+% increase in online buyers4

1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020 ]; 2. 1. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]; 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How do you expect your spend to change in the next 6 months across the following areas?”; April 30-May 03 2020 ; 4. BCG COVID-19 Consumer Sentiment Survey, April 30-May 03 2020 ; 5. [CCI Survey and BCG analysis, Question Text: "Can you tell us the reasons of what made you buy food & grocery online the first time?", N= 6000 transactions]

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In Summary:CPG- Non-Food

Home CarePersonal CareCosmetics

Income Uncertainty

Health & Hygiene

Social Distancing



NEW HABITS

Home Care



2.8x rise in time spent onself help and personal grooming videos1

1. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]; 2. 2. [BCG COVID-19 Consumer Sentiment Survey, categories considered: Fresh Food, Packaged F&, Makeup, Staples, Personal Care, Home Care & Baby Care, Question text: “ In the next 6 months, how do you expect your online spend for the following types of products to change?”, April 30-May 03 2020 ; 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "In the next one month (CPG) how do you expect the choice of your brands to change?”; April 30-May 03 2020; 4 Estimation for 2021, Expert Interview, BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year) 5. . [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020; 6. [Online Search Trends (India), 2nd week of Feb to 4th week of April]; 7. . [Kantar, COVID-19 Barometer India Research Webinar, 3rd April]


1


2


3


4

Rise of 'Smart shopper'

5

Remote way of living6


8

'D'o 'I't 'Y'ourself

7

88% consumers are planning to stick to the choice of the same brand3

29-33% consumers are planning to trade down3

84% consumers who have purchased non food related sub -categories online during

the lockdown are willing to continue2

~1.3x rise expected in share of digitally influenced urban consumers across non-

food categories4

52% consumers have increased use of social media5; more product discovery on social

media e.g. beauty tips, hacks

100% spike in online research of "how to" trends6

47% Indian household claim increased home/toilet cleaning7

91% Indian households washing hands more often7

8 consumer trends will have a higher impact on the CPG (Non-Food) category


Personal Care

Cosmetics


Consumers will trade up in home care, trade down in cosmetics, and selectively trade up /down in personal care owing to a more value conscious, yet quality focused mindset

Salience of digital influence to rise for home care, personal care, and cosmetics; more consumers will increase online research across these categories

Post purchase advocacy will continue to be important; digital will be a powerful medium

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24-29% consumers planning to trade up in homecare and personal

care; while 29-33% are planning to trade down in cosmetics and personal care1

Surge in demand for specific products/variants with an increased focus on health, hygiene, and wellness 2

47% Indian households claim increased home/ toilet cleaning;

91% Indian households washing hands more often2

Changes in basket with a more at-home, do-it-yourself lifestyle 3 2.8x increase in time spent on self help/personal care videos3

4 ~1.3x rise expected in share of digitally influenced urban consumers across non-food categories4

Consumers will look for buying avenues which provide contact-less convenience while fulfilling their core needs of familiarity and immediacy

545+% consumers planning to increase

online spend in the next 6 months; 30+% increase in online buyers5

1 in 2 consumers relied on Word of Mouth for first online purchase in CPG pre-COVID; expected to be fulfilled digitally6

CONSUMER BEHAVIOR CHANGES IN CPG (NON-FOOD) PATH TO PURCHASE

1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020; 2. [Kantar, COVID-19 Barometer India Research Webinar, 3rd April],; 3.[Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27] ; 4. Estimation for 2021, Expert Interview, BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year); 5. BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020 ; 6. . [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020

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THE NEW NORMAL FOR E-COMMERCE WILL SEE NEW PATHWAYS ACROSS CATEGORIES

WHAT WILL IT TAKE FOR YOU TO WIN?



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Digital proliferation and more functional, value seeking choice drivers

Fulfilling core needs of assistance, experience, instant gratification and trust in a contact-less way

Growing importance of brand advocacy and personal touch

STRENGTHEN BRAND POSITIONING

Increase "top-of-the-funnel" branding to

enhance brand equity

CAPTURE THE EXPANDING

ONLINE WALLET: Tap into increasing pool of online buyers and leverage emerging E-commerce models to provide frictionless

experience

Portfolio & Messaging

Channel & Engagement

TAP THE HERE & NOW

OPPORTUNITY: Scale up affordability

initiatives and re-appropriate

promotional spends to aid rebound

Value Focus

ADJUST TO THE NEW NORMAL OF

ENGAGEMENT: Significantly re-design digital

engagement with your consumers

leveraging social media, influencers

and loyalty programs

Presence & Influence

The new pathway is changing and filled with opportunities


Embracing digital services and experiences

Bringing the outside inside


Shoppingfor utility

Strive for health & wellness

Superior hygiene & clean

living: a new norm

Trading down and Bargain Hunting

1

2

Strengthen affordability initiatives

Ramp up personalization and re-marketing capabilities

Leverage social media for "top-of-the-funnel" branding

Scale-up partnerships for exclusive E-commerce launches

Digital proliferation & choice drivers present opportunitiesP

RE-

PU

RC

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UN

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Medium Term Short Term

Assurance for health and hygiene

Localize offerings for changing demographics

Review promotional spends to aid rebound

Scale up partnerships for exclusive e-commerce launches, including in traditionally offline heavy categories

Targeted campaigns to build brand equity (esp. for new online users)

5

Focus on first party data capture to efficiently target and re-target consumers with tailored nudges and offers

Adopt and highlight hygienic and contact-less initiatives across the value chain

3

4 • Accelerate creation of vernacular platforms to cater to new users in tier 2/3 cities

• Localize static ads with dynamic language optimization

7

Scale-up partnerships with Fintechs and banks to

provide affordable payment options (EMIs

etc)

6

• Re-appropriate discounts and promotions among essentials (reduce spends) and discretionary categories (increase spends)

• Advance select sale events to revive consumer sentiment


Accelerated adoption of E-commerce and O2O

Embracing digital services and experiences

Remote way of living DIY – Do It Yourself

PU

RC

HA

SE F

UN

NEL

Fulfilling core needs of assistance, experience, instant gratification and trust in a contact-less way


Remove barriers to online sales to improve sales conversion

Strengthen offline-online supply chain to meet spikes in consumers demand post lockdown

• Product experience / touch / feel / fit: Digital enablers like AR/VR, livestreaming, 3D Videos, detailed catalogues etc.• Assistance: Leverage conversational commerce, virtual query resolution, chatbots etc. (especially for new users)• Immediate gratification: Leverage O2O to develop hyperlocal capabilities with reduced delivery times • Trust in product / seller: Ensure and highlight high quality standards of vendors (especially for SMBs)• Shopping as a social event: Digital enablers for group purchase

• Scale up O2O partnerships to offset supply chain challenges and provide more seamless journeys to customers

8

9


Rise of “Smart Shopper”Embracing digital services

and experiences

PO

ST-

PU

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UN

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Build brand advocacy via personal connect


Drive Value by repeat purchase

10

• Incentivize repeat purchases with loyalty program • Incentivize social peer recommendation: online product reviews, ratings


Flipkart

Brand Showcase (1/4)

AmazonOnePlus8 sales launch via Amazon and OnePlus website with attractive offersPre-launch buzz created with product previews2

Range of Realme products including Realme smartphone Narzo 10A, Realme Watch and TV launched via Flipkart and Realme Website

Curated offers included like Zero-cost EMI options1

Dabur launched Hand sanitizer range and Immunity Booster Tulsi Drops exclusively on Amazon and Flipkart to meet immediate surge in demand during lockdown4

Xiaomi Mi 10 launched on Amazon and Xiaomi website3

Scale up partnerships for exclusive E-commerce launches

Pre-purchase

Source: Press Search and BCG Analysis; 1. [NDTV] [Realme Narzo 10A Goes on Sale Today at 12 Noon via Flipkart, Realme Website: Price and Specifications]; 2. [NDTV] [OnePlus 8 Pro to Go on Sale Today at 12 Noon via Amazon, OnePlus Site: Price in India, Specifications]; 3. [NDTV] [Mi 10 Goes on Sale in India via Amazon, Mi Store: Price in India, Offers, Specifications]; 4. [Economic Times] [BE Exclusive: Dabur launches Tulsi Drops after hand sanitizer]



Myntra1

Leverage Social Media for“top-of-the-funnel” campaigns

Unlock influencer partnerships

Collaborated with 350 fashion influencers & celebrities to create content on look books, styling & product recommendation on own website and social media

1000 pieces of celebrity led content

Launched Myntra Studio to provide users with access to "original, exclusive, inspirational, entertaining and shoppable content at scale" This aims to transform Myntra from a shopping app to a “habit-app”

Pre-purchase

Source: Press Search, Social Media Search and BCG Analysis; 1 [Economic Times] [Myntra launches original fashion content to drive customer engagement amid the lockdown]; 2. Facebook Case Studies

Launched thought leadership campaign using Facebook Live to help new parents through live online sessions with leading pediatricians during COVID-19 as part of the ‘World Immunization Week’2

296KTotal video views

1.4MnReach

82KHighest video views

for 1 live

3Languages (English,

Hindi and Bangla)



Rationalize assortment and SKU-mix to reflect changed needs and preferences of consumers

Flipkart

Amazon1 Nykaa

Myntra

Flipkart SmartBuy also launched hand sanitizers and surgical masks in April, to fight the shortage

Closely working with apparel brands to ensure higher availability of face masks

Amazon has now expanded its Pantry service to 128 cities delivering pulses, packaged food and cleaning products

Myntra partnered with Wildcraft to sell protective face masks

Showcasing range of work-from-home attire where curated styles (including specific ones for conference calls) are available with focus on “comfort, while at work”

The Fashion and beauty E-commerce platform has ventured into the delivery of essential products—bathing essentials, oral care products, home needs, face masks, intimate hygiene essentials, moisturizers etc.

Pre-purchase

Leading E-com players are pushing larger packs to increase the basket size with price laddering (Up to 20% increase in average basket size)

Source: Press Search, Social Media Search and BCG Analysis; 1 [Economic Times] [Covid-19 impact: Curbs on e-commerce upset Amazon’s cart in India]



Strengthen online-offline network to meet spike in consumer demand post lockdown and to provide consumers a seamless experience

Flipkart1

Flipkart has partnered with Spencer’s Retail for hyperlocal delivery of groceries and essentials

Flipkart has partnered with TataConsumer Products for essentialsin an offline-online model

Distributors of the Tata group companies will list themselves on Flipkart as marketplace sellers for essential products such as beverages (Tata Tea and Coffee) and foods (Tata Sampann spices, pulses, and nutria-mixes)

Purchase

Source: Press Search, Social Media Search and BCG Analysis; 1 [Business Standard] [Covid-19: Flipkart ties up with Tata Consumer to provide essentials] [LiveMint] [Flipkart, Spencer's to pilot hyperlocal grocery delivery]; 2. Facebook Case Studies

Mondelez India under their brand ‘Cadbury Joy Deliveries’ enabled joyful moments with indulgent snacks delivered to shopper’s doorstep while they are in the lockdown2

400+Purchases via conversion ads ran

under 'Household Snacks' campaign

on Facebook & Instagram

(Apri’20 –May’20 )


THESE CONSUMER BEHAVIOR TRENDS HAVE VARIED IMPACT ACROSS CATEGORIES

MOBILE APPARELCONSUMER PACKAGED

GOODS

TOP 3 CATEGORIES – ACCOUNTING FOR 65% OF GMV IN INDIA (2019)


DEEP DIVES

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Deep-dive: Mobile



Consumer Behavior Change in P2P: Pre-Purchase

1. [Q: Best description of the need for purchase of your current mobile; Source: CCI Survey and BCG analysis, N=840] 2. [Expert interview and BCG analysis] 3. [Q. “Frequency of purchasing mobiles over last 5 years” Source: CCI Survey and BCG analysis, N=840] 4. [BCG CCI Digital influence Study 2017 , N=18,000, BCG CCI Mobile consumer study, N=2000 and BCG analysis] ; Data for urban consumers shown

DISCOVERY

With higher value consciousness, functional triggers to become more important

1 Salience of digital influence for mobile will rise even more3

% mobile consumers with pure replacement as purchase trigger1 to go up by 5-10%2 …

65-70%60%

..while Shopping for non-functional triggers1 likely to reduce

e.g., "Screen is not clear"e.g., "Phone is slow"

e.g., "Bored with phone"e.g., "I Like the new model"30-35%40%

Higher average replacement time in near-medium term2

8-10%2 increase in near-medium term

for mobile phones

~70%2 urban consumers for mobiles expected to be digitally influenced

Pre-COVID, 55-60%4 urban mobile consumers were digitally influenced (used online to discover or research or compare products)

Post-COVID

55-60% 70%

Pre-COVID

SHOPPING FOR UTILITY

Reversal of past trends, likely to be temporary

EMBRACING DIGITAL SERVICES &

EXPERIENCES

Acceleration ofexisting trends, likelyto last longer term

Pre-COVID Post-COVID

Pre-COVID Post-COVID

Pre-COVID

2.4 Yrs3 +8-10%

Post-COVID



1.. [Percentage of Smartphone users; Source BCG CCI Mobile consumer study and BCG analysis, N=2000] 2. [Considering average of Rank 1-3 responses. Q: “Thinking about your most recently purchased mobile phone, can you tell me the 3 most important factors which helped decide what product should be bought?" Source: BCG CCI Survey and BCG analysis, N=840] 3. [Q. “Please state the reason to spend more/ less in near future?” (for those increasing expenses) Source: BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020, N=1,327] 4. [Q. “In the next 6 months, how do you expect the choice of your brand to change” (for those decreasing expenses) Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, N=2106]; Data shown for urban consumers

DISCOVERY

With a value seeking mindset, importance of pricing as a choice driver to go up

5

• Both salience and maturity of online research to increase

• More price, feature, performance comparisons expected

• Retailer influence may go down as consumers look for more contact-less shopping

Likely to

increase

Likely to

decrease

55%

% smartphone users using

online research (pre-COVID)1

53%

% smartphone users using

retailer recommendations

(pre-COVID)1

Consumers may trade down in their choice of purchase/look for offers and deals

% respondents (post-COVID)

Salience of price-conscious consumers may increase25%

% respondents with "Price" in top 3 choice driver for mobiles (pre-COVID)2

Of those looking to decrease spends on mobiles will buy cheaper variant4

Of those looking to increase spends on mobiles are looking for deals3

RISE OF 'SMARTSHOPPER'

Acceleration ofexisting trends, likelyto last longer term

TRADING DOWN AND BARGAIN

HUNTING


CONSIDERATION

59% 40%

4 With social distancing, importance of online research to

increase



With changing use cases, consumers will be more feature conscious Uncertainties due to pandemic may lead to some consumers experimenting less

8

Certain features may become more important

REMOTE WAY OF LIVINGNew habit, stickiness unclear

TRUST IN BRAND ABOVE ALL ELSE


CONSIDERATION

23% Salience of feature-conscious consumers may increase

% respondents with "Features" in top 3 choice driver for mobiles (pre-COVID)1

Leading to need for higher video stability, security etc.

Post-COVID increase is screen-time2 spent on


Traditionally, mobile consumers have not been brand loyal58%

% pre-COVID Consumers who switched brands3

Post-COVID, 70% Consumers with a positive spending outlook for mobiles

likely to stick with brand choice already in mind4

16%

485%

Video Streaming

Video Conferencing

70%

1. [Considering average of Rank 1-3 responses. Q: “Thinking about your most recently purchased mobile phone, can you tell me the 3 most important factors which helped decide what product should be bought?" Source: CCI Survey , N=840] 2. [BARC Nielsen – TV + Smartphone consumption report during COVID, 7th May 2020] 3. [Q: "Which brands do your current and previous phones belong to?" Source: CCI Survey & BCG analysis , N=840] 4. [Q. “In the next 6 months, how do you expect the choice of your brand to change" (for those increasing expenses); Source: BCG COVID-19 Consumer Sentiment Survey March 23-26, N=2106 ] ; Data shown for urban consumers

6

7


Consumer Behavior Change in P2P: Purchase and Post-Purchase

1. [Expert interview and BCG analysis ] 2. [IDC India Mobile Phone Tracker ; % by value] 3. [Q. “In the next 6 months, how do you expect your online spend for the following types of products to change?” Source: BCG COVID-19 Consumer Sentiment Survey April 30-May 03 2020, N=1,327] 4. [Q: "List of statements read out for 4 channels and asked to choose which channels are applicable to each of the statement"; Source: CCI Survey, N=840] ; Data shown for urban consumers

Higher need for at-home or virtual post sales service

11

ACCELERATED ADOPTION OF E-

COMMERCE AND O2O

Acceleration of existing trends, likely to last longer term

BRINGING THE OUTSIDE INSIDE


10Affinity for online will accelerate even more

Online share for mobile phones (in value terms) likely to reach 45% in the next 2 years1 from pre-COVID38%2

38%

Post-COVID

45%

Pre-COVID

55% consumers intend to increase online spends on mobile in the next 6 months3

% respondents

(Post-COVID)

Consumers will expect positives of offline along with safety and convenience of contact-less purchase

Traditionally, 3 key barriers to online purchase of mobiles4 - must be addressed for digital conversion

Lack of product experience before buying

1

Lack of opportunity to leverage salesperson knowledge

2

No personal relationship3

PURCHASE POST-PURCHASE

With social distancing, mobile consumers will want to limit store visits for after-sales service

55%

9

Deep-dive:Apparel


PRE-PURCHASE


1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus?", "Which statement best describes your behavior since the Lockdown?", Source: BCG COVID-19 Consumer Sentiment Survey, May 18-May 23 2020 (March 23-26, April 17-20 2020, April 30-May 03, May 18-23, 2020 (N = 2,106, N = 2,324, N=1,327 , and N-3276 respectively))], 2. [CCI Survey and BCG analysis, Question Text: Occasion/reason for your last purchase in given apparel subcategory?, N=1218], 3. [CCI Survey and BCG analysis, Question Text: : Thinking about your last purchase for given subcategory, can you tell me the three most important factors which helped decide what product should be bought?, N=1218], 4.[BCG COVID-19 Consumer Sentiment Survey, Question Text: “Please state the reason to spend more/ less in near future?” , Source: BCG COVID-19 Consumer Sentiment Survey, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 5. [BCG COVID-19 Consumer Sentiment Survey, Question Text: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))],

SHOPPING TRIGGERS WILL BE MORE FUNCTIONAL AS OPPOSED TO BEING LED BY OCCASIONS

1

SHOPPING FOR UTILITY


2

Consumer's brand choices to be impacted by income uncertainty

TRADING DOWN AND BARGAIN HUNTING



Will look for discounts among those who are increasing expenditure in apparel4

40%

Will trade down to cheaper brands or lower variants

of same brand5

32%

SOME CONSUMERS WILL SEEK ATTRACTIVE PRICING OR MAY TRADE DOWN IN CHOICES

With social distancing, less purchases for specific occasions

% respondents

(pre-COVID)2

41%

Value seeking mindset will trigger more utility shopping

% respondents

(pre-COVID)2

15%

With increased value consciousness, pricing will be a more important choice driver

% respondents

(pre-COVID)3

26%57%

% respondents

(post-COVID)1

Consumers have stopped or reduced going out to meet friends (1.2x times more in large towns vs. small towns)

Shopped apparels due to

celebratory occasions

Shopped apparels due to

functional requirements

Had price in top 3

choice drivers


PRE-PURCHASE


REMOTE WAY OF LIVING

New habit, stickiness unclear

STRIVE FOR HEALTH & WELLNESS


CASUALIZATION OF WARDROBE AND HIGHER DEMAND FOR COMFORT WITH A MORE “STAY-AT-HOME” LIFESTYLE

3 4 GIVEN INCREASING FOCUS ON HEALTH AND WELLNESS, THERE WILL BE HIGHER DEMAND FOR FITNESS WEAR

79%Consumers are unwilling to go out of house, except workThis is impacting their wardrobe needs

Casual wear expected to become a larger part of both men/women portfolio13%

Comfort in type of clothing and design will be higher in demand with a more at-home lifestyle

1.4x

Increase in Time Spent

(post-COVID)3

Increase in time spent on fitness apps2

Consumers are becoming increasingly more health conscious

Increase in demand for fitness related fashion such as athleisure/sportswear

Precautionary equipment like face masks may become a fashion accessory from essential commodity

Market is driven by casual

wear for men and women

% respondents

(post-COVID)1

% market share

(pre-COVID)2

1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus? Combined Strongly agree and somewhat agree", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 2. [Images retail report, Technopak, Wazir report, Expert Interviews, BCG analysis, 3. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27]


Consumer Behavior Change in P2P: Pre-Purchase and Purchase

WITH MORE TIME ONLINE, DIGITAL INFLUENCE WILL RISE FOR APPAREL SHOPPERS

5

EMBRACING DIGITAL SERVICES & EXPERIENCES


55-60% urban consumers expected to be digitally influenced1

Pre-COVID, 45-50% apparel consumers were digitally influenced (used online to

discover or research or compare products)1

45-50%

55-60%

post-COVIDpre-COVID

SUPERIOR HYGIENE & CLEAN LIVING: A NEW NORM


6 CONSUMERS WILL EXPECT HIGHER STANDARDS OF HYGIENE AS THEY RETURN BACK TO STORES

Consumers will need new norms to alleviate their concerns and make them comfortable in-store

50%

57%

% respondents

(post-COVID)4

Most prominent for 36-45 years segment

44%

% respondents (post-COVID)2

44% consumers will start/ increase online research

6

PURCHASEPRE-PURCHASE

% respondents

(post-COVID)3

Consumers likely to return to shops/ malls within a few weeks, once the virus is 'under control‘

Consumers globally want retailers to focus on high standards of store hygiene, once the lockdown is overSimilar behavior expected in India

1. Estimation for 2021 from expert interviews and BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year), 2. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your online research behavior before buying these types of products?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. [BCG COVID-19 Consumer Sentiment Survey, Question text: “If coronavirus were to be under control, after how long do you think your spending would return to normal i.e., similar to before the Coronavirus outbreak?" Excludes those who never did the activity before Coronavirus?”, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 4. BCG COVID-19 Consumer Sentiment Survey, April 17–20, 2020 (N = 5,729 across China, Germany, Italy, UK, and US; unweighted)


PURCHASE

Consumer Behavior Change in P2P: Purchase

ACCELERATED ADOPTION OF E-COMMERCE AND O2OAcceleration of existing trends, likely to last longer term

Consumers are planning to increase online spend on apparel

Increase in the number of consumers buying apparel online

Consumers who have purchased apparel online during the lockdown and are willing to continue

40%

% respondents

(post-COVID)2

1.3x

Increase in respondents

(post-COVID)1

90%

% respondents

(post-COVID)3

Traditionally, there have been 3 key barriers to online purchase of apparel4

Ability to Touch-Feel 1

Assurance to Fit2

Experience of shopping in group3

Consumers will be more open to models like omni-channel/digital innovations, which fulfil their core needs along with new need to socially distance

7 8SURGE EXPECTED IN PREFERENCE FOR ONLINE APPAREL SHOPPING

CONSUMERS WILL NEED FEEL/FIT/SOCIAL EXPERIENCE ALONG WITH A NEW NEED FOR CONTACT-LESS CONVENIENCE IN SHOPPING

1. [BCG COVID-19 Consumer Sentiment Survey, Question text: “ In the next 6 months, how do you expect your online spend for the following types of products to change?”, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 2. [BCG COVID-19 Consumer Sentiment Survey, Question text: "Which statement best describes your usage behavior since the Lockdown?] April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))],3. [BCG COVID-19 Consumer Sentiment Survey, Question text: " You mentioned that you have started online purchase of apparel since the Lockdown. How likely are you to continue purchasing apparel online even after the Lockdown gets lifted ?”, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 4. [Fashion Forward 2020, BCG & Facebook Report


Consumer Behavior Change in P2P: Post Purchase

POST PURCHASE

Consumers on social media learn about products across categories through influencers

40%

With more time on social media, impact of digital influencers and recommendations will become more important

Consumers have increased use of social media52%

9 CORE NEED FOR PEER RECOMMENDATIONS IN APPAREL SHOPPING MAY BE FULFILLED DIGITALLY, WITH GROWING VIRTUAL CONNECT



Consumers rely on peer recommendations and reviews to buy apparels1 in 2

% respondents

(post-COVID)3

% respondents

(pre-COVID)1

% respondents

(pre-COVID)2

1. [CCI Survey and BCG analysis, Question Text: Which of the following sources of information influence your decision the most for purchase of apparel?, Source: CCI Survey and BCG analysis], 2.[ Mobile Marketing Association India Mobile Marketing EcosystemReport 2020], 3.[BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))]

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CPG- Food

Fresh FoodStaplesPackaged Food



1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))],

PRE-PURCHASE

Consumers will trade up in staples and selectively trade up /down in packaged food owing to a more value conscious, yet quality focused mindset

1

STRIVE FORHEALTH & WELLNESS




Trading up more prominent in SEC A consumers for staples and packaged food

Trading down more prominent in SEC B consumers for packaged food

2x

More than SEC B(post-COVID)

Consumers will trade up across staples and packaged food

31%

% respondents trading up

18%

Buy more expensive brand

13%

Buy same brand, higher variant

Consumers will also trade down in packaged food

28%

% respondents trading down

16%

Buy less expensive brand

12%

Buy same brand, lower variant

More than SEC A(post-COVID)

1.3x

(post-COVID)(post-COVID)



Consumers not going out of home, except work

With reduced trips for shopping, dip in impulse buys (e.g., chewing gum)

Owing to more 'at home' consumption, drop in demand for smaller SKUs (e.g., buy 100 gm vs 50 gm biscuit SKU with more consumption at home)

‘D‘O ‘I‘T ‘Y‘OURSELF


BRINGING OUTSIDE

INSIDE



STRIVE FOR HEALTH & WELLNESS

2 Changes in basket with a more at-home, do-it-yourself lifestyle Surge in demand for specific products/variants with an increased focus on health, hygiene, and wellness

3

79%

Rise in viewership of recipes with more home cooking

Potential growth in demand for cooking supplies and shelf stable packaged food

2.7x

Spike in online search on health & immunity

More demand for immunity building food products

Consumers increase spend on health and wellness products

Spike in demand for healthy variants of food products (packaged and unpackaged)

Increase in

viewership

(post-COVID)1

% respondents

(post-COVID)2

PRE-PURCHASE

49%

% respondents

(post-COVID)3

1.2x

Increase in

online search

(post-COVID)4

1. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27], 2. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How much do you agree with each of the following statements about the coronavirus? Combined Strongly agree and somewhat agree", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: "How do you expect your spend to change in the next 6 months across the following areas?” April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 4. [Online Search Trends (India)]



StaplesFresh Food Packaged Food

1.5x1.6x 1.4x

Increase in users (post-COVID)1

Increase in new online buyers for food categories

Consumers will be open to buying models which mitigates these barriers and leverages the convenience of online


Pre-COVID, top 3 barriers to online purchase of CPG3

PURCHASE

ACCELERATED ADOPTIONOF E-COMMERCE AND O2O

Consumers will look for buying avenues which provide contact-less convenience while fulfilling their core needs of familiarity and immediacy4

1

2

3

Need to check product quality

Immediate need for products

Easier return and other local store benefits

80+% New online buyers for food categories likely to continue post-COVID2

1 [BCG COVID-19 Consumer Sentiment Survey, Question text: “Which statement best describes your usage behavior since the Lockdown?”, April 17-20 2020, N = 2,324, and N=1,327 respectively], 2. [BCG COVID-19 Consumer Sentiment Survey, categories considered: Fresh Food, Packaged F&, Makeup, Staples, Personal Care, Home Care & Baby Care, Question text: “You mentioned that you have started online purchase of CPG since the Lockdown. How likely are you to continue purchasing CPG online even after the Lockdown gets lifted?”, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. . [BCG, Retail 4.0: Winning the 20s, Feb 2020],4. BCG COVID-19 Consumer Sentiment Survey, Question text: "Which statement best describes your usage behavior since the Lockdown?] April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))]

StaplesFresh Food Packaged Food

51%44% 47%


Consumers planning to increase online spend in the next 6 months



POST PURCHASE

5 Post purchase advocacy will continue to be important; digital will be a powerful medium

Consumers will start/ increase online research before purchasing food related sub-categories

44%

% respondents(post-COVID)3

With more use of social media, significance of social media as a platform for recommendations and thus discovery will go up e.g., sharing recipes, reviews of food products, food related content etc.



Consumers rely on Word of Mouth (WoM) for first online purchase in CPG

% respondents(pre-COVID)1

1 in 2

of all consumers have increased use of social media52%


1. [CCI Survey and BCG analysis, Question Text: "Can you tell us the reasons of what made you buy food & grocery online the first time?", N= 6000 transactions] , 2.[BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))] ,3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your online research behavior before buying these types of products?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))]

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Deep dive:CPG- Non-Food

Home CarePersonal CareCosmetics



PRE-PURCHASE

29%


5%

Buy more expensive

brand

24%

Buy same brand, higher

variant

Home Care Personal Care

24%


15%

Buy more expensive

brand

9%

Buy same brand, higher

variant

Cosmetics

33%


19%

Buy less expensive

brand

14%

Buy same brand, lower

variant

Personal Care

29%


13%

Buy less expensive

brand

16%

Buy same brand, lower

variant

(post-COVID) (post-COVID)

2xTrading up more prominent in SEC A consumers for home care

Consumers will trade up in home care, trade down in cosmetics, and selectively trade up /down in personal care owing to a more value conscious, yet quality focused mindset

1

STRIVE FORHEALTH & WELLNESS




2xTrading up more prominent in SEC A consumers for personal care 1.4x

Trading down more prominent in 18-25 years consumers for cosmetics 1.4x

Trading down more prominent in SEC B consumers for personal care

1. [BCG COVID-19 Consumer Sentiment Survey, Question Text: “In In the next one how do you expect the choice of your brands to change?”; April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))],

(post-COVID) (post-COVID)



More than 26+ years(post-COVID)

More than SEC A(post-COVID)



Indian households claim increased home/toilet cleaning

Increase in demand for disinfecting & cleaning home care products (e.g., surface cleaners)

SUPERIORHYGIENE & CLEAN LIVING: A

NEW NORM


2 Surge in demand for specific products/variants with an increased focus on health, hygiene, and wellness

Indian households washing hands more often

14x jump in online sales of personal care productssuch as sanitizer from Feb – March3

PRE-PURCHASE

Rise in time spent on self help/personal care videos as consumers are avoiding salons

With reduced trips for shopping, dip in impulse buys (e.g., lip balms)

Consumers not going out of home, except work

Changes in basket with a more at-home, do-it-yourself lifestyle 3

BRINGING OUTSIDE

INSIDE


Increase in demand for personal care products such as depilatories, hair dyes, and face masks

91%

% respondents

(post-COVID)2

2.8x

Increase in time

(post-COVID)1

47%

% respondents

(post-COVID)2

79%

% respondents

(post-COVID)4

1. [Nielsen, Nielsen TV and Smartphone report, Week of March 30 vs Week of April 27] ,2. [Kantar, COVID-19 Barometer India Research Webinar, 3rd April], 3. Press Search: [Livemint, Covid-19 impact: Sanitiser market sees more entrants] , 4. [CCI Survey and BCG analysis, Question Text: "Can you tell us the reasons of what made you buy food & grocery online the first time?", N= 6000 transactions]



RISE OF SMART SHOPPER


~1.3x rise expected in share of digitally influenced urban consumers

Homecare

Most prominent for 26-35 years

segment

30% 35%

Personal Care

Most prominent for SEC B

consumers

38%

Cosmetics

Most prominent for 18-35 years

segment


PRE-PURCHASE

30-40% urban consumers will start/ increase online research

Post-COVID 1

1. Estimation for 2021, Expert Interview, BCG CCI Digital Influence Study 2017 analysis (N=18,000 per year); 2. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your online research behavior before buying these types of products?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior acrossthe following areas?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))] ,

Salience of digital influence to rise for home care, personal care, and cosmetics; more consumers will increase online research across these categories

4

Increase in digital influence among urban consumers for non-food

categories

With 52% consumers planning to increase time on social media3, it will be an important

platform for product discovery and research

~1.3x

Online channels will play a more important role for product

discovery, research, and comparisons



Consumers will be open to buying models which mitigates these barriers and leverages the convenience of online


Pre-COVID, top 3 barriers to online purchase of CPG3

PURCHASE

ACCELERATED ADOPTIONOF E-COMMERCE AND O2O

Consumers will look for buying avenues which provide contact-less convenience while fulfilling their core needs of familiarity and immediacy5

1

2

3

Need to check product quality

Immediate need for products

Easier return and other local store benefits

Personal CareHome Care Cosmetics

1.3x1.45x 1.35x

Increase in users (post-COVID)1

Increase in new online buyers for non-food categories

84+% New online buyers for non-food categories likely to continue post-COVID2

1 [BCG COVID-19 Consumer Sentiment Survey, Question text: “Which statement best describes your usage behavior since the Lockdown?”, April 17-20 2020, N = 2,324, and N=1,327 respectively], 2. [BCG COVID-19 Consumer Sentiment Survey, categories considered: Fresh Food, Packaged F&, Makeup, Staples, Personal Care, Home Care & Baby Care, Question text: “You mentioned that you have started online purchase of CPG since the Lockdown. How likely are you to continue purchasing CPG online even after the Lockdown gets lifted?”, April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))], 3. [BCG, Retail 4.0: Winning the 20s, Feb 2020],4. BCG COVID-19 Consumer Sentiment Survey, Question text: "Which statement best describes your usage behavior since the Lockdown?] April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))]

Personal CareHome Care Cosmetics

46%51% 43%


Consumers planning to increase online spend in the next 6 months



POST PURCHASE

6 Post purchase advocacy will continue to be important; digital will be a powerful medium



1. [CCI Survey and BCG analysis, Question Text: "Can you tell us the reasons of what made you buy food & grocery online the first time?", N= 6000 transactions], 2. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your usage behavior across the following areas?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))] ,3. [BCG COVID-19 Consumer Sentiment Survey, Question Text: " Which statement best describes your online research behavior before buying these types of products?", April 30-May 03 2020 (March 23-26, April 17-20 2020, April 30-May 03 2020 (N = 2,106, N = 2,324, and N=1,327 respectively))],

Consumers will start/ increase online research before purchasing non-food related sub-categories

35%


With more use of social media, significance of social media as a platform for recommendations and thus discovery will go up e.g., sharing easy beauty tips, personal care hacks etc.

Consumers rely on Word of Mouth (WoM) for first online purchase in CPG

% respondents(pre-COVID)1

1 in 2

of all consumers have increased use of social media 52%


Documents

T urn the Tide - Boston Consulting Group · 2020. 8. 18. · Inflation / Price Indicators8 •70 bps drop in CPI •130 bps drop in WPI Web Traffic trends Internet peak traffic saw