COVID-19 and the Indian consumer - Responding in a time of crisis - EY
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Across the globe COVID – 19 has impacted us at a primal level Protect myself and my family Protect my livelihood Protect my way of life Page 2 10 April 2020 Presentation title
India is grappling with immediate ramifications of this outbreak Forced to not leave Only essentials Rise in digital home unless available as India consumption due absolutely critical entered total to isolation Social Panic lockdown Digital distancing buying consumption Lockdown Restricted Fake Innovative ways of living Fears and services Rise in fake news news maintaining social confusion led to and distancing panic buying misinformation across social media platforms Page 3 10 April 2020 Presentation title
This black swan event has accelerated change on key customer dimensions 1 Digital customer journey ► Digital adoption to increase across all customer journeys - from pre-purchase to post-sales. The impending recession and consumer reluctance to engage physically will accelerate the evolution of ‘post – Covid digital-only’ models ► Acceleration of new products and services to exploit this increased comfort with digital journeys 2 3 Hyperlocal and online communities Healthy living ► Hyperlocal community interaction to increase ► Greater focus on healthy living and proactive health maintenance ► Digital person2person interaction ► Increase in consumption of health, fitness, and supplements ► Work from home ► Increase in organic/healthy eating habits ► Growth in the power of digital influencers ► Move to online medical care and assistance 4 5 Digital content consumption Consumers and the State ► News and entertainment ► Greater awareness of security and privacy ► Digital learning ► Set up of state surveillance infrastructure ► Gaming, events and experiences ► Discipline, accountability and traceability Source: EY research Page 4 10 April 2020 Presentation title
Consumer behaviour seems to have changed for good across these dimensions... Digital customer Hyperlocal and online Healthy Digital content Consumers and journeys communities living consumption the state Grofers - New orders up by 14-15%, Post imposition of lockdown, many Cure.fit - “The number of people using Cult-.live Voot - “What we would have expected to do in terms Andhra Pradesh has made a list of Number of orders from the existing users 2X organisations in India started using will hit 200,000 in the next one week,” said of number of subscribers in 60 days, we have already 25,000 people who are on COVID19 risk Lockdown situation - the past week. virtual collaboration tools such as Ankit Nagori, cofounder, Cure.fit. done in the first 10 days.” Ferzad Palia, head of Voot due to their travel history. They are https://www.businesstoday.in/current/corporate/covid-19-online- Zoom, Slack, Microsoft Teams etc. to https://economictimes.indiatimes.com/news/politics-and-nation/covid- Select, youth, music and english entertainment of tracking them through their mobile India specific grocery-platforms-to-benefit-as-consumers-flock-to-shop- online/story/398600.html be virtually connected asana-indians-go-big-on-yoga-from- Viacom18 numbers and alerting teams If somebody home/articleshow/74741684.cms?from=mdr https://www.zdnet.com/article/effective-strategies-and- https://www.business-standard.com/article/companies/spike-in-viewership-across- is breaking quarantine. otts-as-indians-binge-watch-staying-indoors-120031801866_1.html tools-for-remote-work-during-coronavirus/ Sarva - Rolled out classes on Instagram earlier https://www.businesstoday.in/latest/trends/coronavirus-crisis- andhra-pradesh-govt-tracking-mobile-phones-of-home- this week, saw 1,000-1,500 people have been quarantined-people/story/399692.html Amazon - Change in content formats provided - attending sessions every day. Big Basket - There has been a 2x growth in various providers such as Amazon Prime are Karnataka government directive the https://economictimes.indiatimes.com/news/politics-and-nation/covid- traffic and revenue and there has been a asana-indians-go-big-on-yoga-from- providing special free catalogue for family and home quarantined coronavirus suspects 15-20 per cent increase in basket value home/articleshow/74741684.cms?utm_source=contentofinterest&utm_ medium=text&utm_campaign=cppst children to boost consumption & patients will have to send their selfies https://www.livemint.com/news/india/covid-19-streaming-services-experiment-with- every one hour on https://www.businesstoday.in/current/corporate/covid-19- online-grocery-platforms-to-benefit-as-consumers-flock-to- Portea - Live video consulting facility for free-offers-as-people-stay-home-11585036708397.html the Quarantine Watch, a mobile shop-online/story/398600.html application developed by government's physiotherapy a full-fledged service a Unacademy founder and CEO Gaurav Munjal said, "In revenue department to keep a track of couple of weeks back. the last three weeks, learners who are watching free the isolated persons. The government https://www.thehindubusinessline.com/info-tech/how-online-healthcare- live classes have increased by 3x. We are clocking 30 is-stepping-in-to-serve-non-covid-19-patients-in- warned the home quarantined people million minutes of watchtime on Unacademy every india/article31179651.ece that they will be sent to mass quarantine single day.” centres if they violate the rule. https://www.livemint.com/companies/news/covid-19-impact-online-learning- https://economictimes.indiatimes.com/news/politics-and- companies-see-spike-in-number-of-students-11584724448197.html nation/those-in-home-quarantine-in-karnataka-directed-to- send-selfies-every-hour-to- govt/articleshow/74907051.cms?from=mdr International Market Learnings From BAIC BJEV, Jetour - In China, online car DingTalk moved from 40th to 3rd Push Doctor - The pandemic has pushed Yahoo! News unique audience increased by 24% (Daily China has reportedly relied on mass sales went up in the first weeks of the crisis. position in usage in China as digital health into the mainstream: Push Average - 21,727) in Japan amid COVID-19 concerns surveillance of phones to classify Baic Bjev and Jetour, the two brands with many companies have asked their Doctor saw a 30% increase in consultations. https://www.nielsen.com/wp-content/uploads/sites/3/2020/03/The-Impact-of- individuals by their health status and COVID-19-on-Media-Consumption-Across-North-Asia.pdf digital retail experience have managed to employees to work from home Last week, consultations were up by 70%. restrict their movements. secure a place among the Top 5 players in https://qz.com/work/1802044/what-its-like-to-work- https://sifted.eu/articles/digital-doctor-demand-coronavirus/ https://www.sciencemag.org/news/2020/03/cellphone- from-home-in-coronavirus-hit-china/ tracking-could-help-stem-spread-coronavirus-privacy-price terms of search volume https://www.reply.com/en/covid-19-report WeChat Work also saw a 10-fold increase in usage https://www.businessofapps.com/data/wechat- statistics/ Page 5 10 April 2020 Presentation title
…posing unforeseen challenges for businesses across the nation Closure of front Complete lack of Major supply chain and Working capital Issues regarding No contact with offices – sales demand apart from logistics issues due to and cashflow employee safety customers who are not outlet/showrooms etc. essentials items lockdowns issues and losses active on digital channels Response examples Creating awareness among Providing customers with Enabling employees with Pushing/encouraging customers customers with new additional and emergency required facilities to work to adopt digital modes of company logos promoting services to help them amid from home purchasing or enquiring about a social distancing COVID-19 scenario product Page 6 10 April 2020 Presentation title
Five key action areas emerge as the new epicentres of customer focus 1. Re-baseline consumer insights 2. Empathetic branding Innovate Re-learn Personalize (product, pricing, engagement) New Re-imagining brand in Integrated real time Realign marketing segments the digital only world marketing communication spend emerge Health-freaks Remote-workers Neo-digital Hyper-local DIY- enthusiasts 3. Digital-only 4. Remote collaboration Leap from Redesign all parts of Restructure customer Launch Competitive Incubate cross-functional Evaluate cultural physical to customer journey to operations for digital collaboration in face of teams (shift from functional aspects of virtual digital-only enable digital Direct2Consumer products new consumer needs focus to consumer) teaming 5. Virtualized sales and service Merged frontlines (Sales + Service) e-tail with reduced channel dependence Online consumer community based Proliferation of self- sales and service service, DIY culture Page 7 10 April 2020 Presentation title
Planning the now, next and beyond scenarios is critical to survival Now Next Beyond High Consider non-crisis Prepare for Re-align brand related ‘escapist’ recovery messaging with Scenario analysis comms campaigns ‘recovery’ to model demand changes Continued transparent & Direct-to-Consumer Eliminate / reduce empathetic comms outreach physical assets Re-baseline to Ongoing brand create new sentiment tracking segments Create, revise & Customer reach enhance digital Research impact Align comms with customer journeys Invest in emerging digital technologies by customer sentiment analysis segment Prepare capacity Understand Use analytics for and content for customer liquidity targeted & self-service & Embed automation in Operations (CPQ, Order impacts “empathetic” digital sales Execution, Fulfilment) campaigns Immediate brand Enable remote sentiment analysis Expand digital experiences with a resources & personal touch access for virtual Communicate with sales & service Shore up empathy & clarity capability for Expand network digital payments Immediate capacity to handle mitigation of any Low increased digital Customer Behaviour Change ‘tone-deaf’ comms Sustained Capability Build demand Time to realise Re-baseline consumer insights Remote collaboration Digital-only Source: EY research Empathetic branding Virtualized sales & service Page 8 10 April 2020 Presentation title
Call to action: immediate measures to ensure customer excellence in the face of imminent challenges Re-baseline Empathetic Remote Virtualized consumer insights Digital-only branding collaboration sales and service ► Focus on risk mitigation and ► Engage with customers ► Build and strengthen E-Com ► Enable “Work from home for ► Realigning after-sales service business continuity through proactive relationships and shift focus sales force” through digital to provide best feasible Immediate ► Proactively set customer communication and to active channels and means support action expectations regarding assistance customer segments ► Review all non value added ► Agile sales team management changes to product and ► Demonstrate organisation’s ► Monitor regulatory activities to minimize physical through beat restructuring, service offerings brand and purpose in requirements and approvals movements/use of low cost recrafting of roles and clear communication with ► Expand network capacity to automation communication customers handle increased digital ► Explore use of emerging ► Redeploy ASP spends to ► Focus on tracking brand demand technology and automation to promote channel liquidity, sentiment and conduct ► Pivot to identify and assess reduce people contact and channel partner loyalty and analysis driven campaigns new revenue streams eliminate risk new channels ► Unlearn pre-COVID customer ► Communicate with empathy, ► Ensure website and digital ► Invest in emerging ► Expand network capacity for Medium-term insights and re-learn their be responsible with brand ordering resilience to technologies such as VR for increased digital sales expectations and needs to promises and promotions eliminate the need of middle- remote product walk-throughs demand plan create new segments ► Use analytics for targeted men like dealers, retailers to enhance B2B sales ► Call Centre: Expand ► Deepen customer research and relevant marketing ► Promote self-care and auto- interactions resources & access for efforts to understand which ► Enhance digital marketing in ticket logging to eliminate ► Call centre: Seek to partner remote workers to enable a segments are impacted in B2B the need of contact centres with external providers for virtual contact centre what ways ► Prepare for recovery and a over-flow or accelerated ► Consider AR or visual search planned digital marketing / capacity. Tap into the gig- in a repair scenario communication plan economy where appropriate Enablers Emergence Pricing Product Household Digital Nano Digital Direct to Drone Remote Gig Chatbots Home Online e-Service of new innovation innovation view marketing targeting adoption consumer deliveries working culture contact centers sales segments Page 9 EY research Source: 10 April 2020 Presentation title
KEY CONTACTS Mahesh Makhija Shashank Shwet Digital & Customer Leader – India Customer & Design Expert mahesh.makhija@in.ey.com shashank.Shwet@in.ey.com Ashish Nanda Shilpa Singhai Consumer Products Leader - India Frontline Expert ashish.nanda@in.ey.com shilpa.singhai@in.ey.com Page 10 10 April 2020 Presentation title
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