“We need to be very close to consumers and their habits, needs and wants, more now than ever,” said the company’s chief financial officer, Jon Moeller, during an earnings call last month.
Preliminary evidence suggests that the shift to online shopping is accelerating, consumers are buying more products for their health and home, and are becoming more cost conscious as they choose to save more.
“For me, that is a super interesting job because clearly this will not be a quick recovery,” said Schneider. “This will be a multi-quarter, if not multi-year, process in which it is safe to expect some changed category dynamics.”
In an environment where almost everything changed overnight, consumer goods companies need to discover what new buying patterns are temporary, likely to end up with blockages or the arrival of a vaccine, and which ones will persist, changing the how consumers spend their money for years. come.
There is no “playbook” for this recession, he told CNN Business. “It will require us to be extremely agile and flexible for the foreseeable future.”
Their research found that the UK’s three largest grocery stores added more than 500,000 new delivery spaces in the space of a few weeks, an increase of more than 30%.
Nestlé’s e-commerce sales worldwide increased by 30% in the first three months of the year, while Procter & Gamble reported 35% growth in online sales during the same period.
E-commerce is unlikely to remain at a very high level at the moment, but “we have reached a higher plateau to grow,” said Jack Neele, portfolio manager at Dutch financial services firm Robeco.
Health and hygiene
“We are pretty sure that anything in the health and wellness arena will enjoy sustained force,” Alan Jope, CEO of Unilever, said last month.
Unilever has seen increased sales of products like Lipton Immune Support, as well as drinks that contain zinc and vitamin C, Faber said. The company is moving rapidly to deploy them worldwide, and health will continue to be a priority for product innovation, he added.
“We will serve what is likely to become a forever-altered approach to health, hygiene and cleanliness,” said Mocter of Procter & Gamble, noting that American consumers wash their clothes more frequently, which adds up to more loads of clothes per month. .
Nesting at home
Even when closings are lifted and restaurants, bars, and movie theaters reopened, there is a sense that people will be in no rush to go out again.
“There may be a greater focus at home: more time at home, more meals at home, more cleaning at home,” said Moeller.
For others who have spent time and money to improve their homes and gardens, or have acquired new hobbies, the possibility of staying is more attractive than it was before.
“Staying is new,” according to the McKinsey report. “Once the restrictions are lifted, we expect consumers to continue to spend more time at home, fueled by a desire to save money, lingering security concerns and a newly discovered pleasure in nesting.”
The growth of online sales of bread machines in the United States It ranked second after disposable gloves in March, up 652% compared to the previous year, according to data compiled by retail tech company Stackline. Online sales of weight training equipment (+ 307%), kits and craft projects (+ 117%), and ping pong tables (+ 89%) reflect that many consumers were finding new ways to entertain themselves at home.
In a nod to this trend, Nestlé USA launched a new range of ready-to-eat foods last week. Faber, the Unilever executive, described the trend as “cocoon.”
Courage and confidence
Even in rich countries, value and affordability will become increasingly important, said Jope of Unilever. He noted the company’s ability to offer products at the “incredible low price” that it can in countries like India as a “gigantic force.”
“In Europe, we can count on negative price pressure as economies … fall into crisis,” he said.
Along the same lines, Procter & Gamble said it is in a better position to weather the economic downturn because its portfolio focuses on everyday items. “We have never faced the level of unemployment that we like to see in this country [the United States] and potentially others, and we don’t know how long that will happen, “Moeller said.
But, for now at least, Nestlé, Unilever and Procter & Gamble are confident that consumers will balance price with value, choosing established brands with which they are familiar and experiencing less.
“People will go back to the big, trusted brands,” said Faber of Unilever. “They simply cannot afford to spend money on products that they are unsure about.”