By Deba Ghoshal
Customer behaviour has witnessed a churn over the last two years that was unexpected. Consumers have evolved in certain ways and in some other ways, gone back to old buying habits, indicating the revival of innate buying patterns. The rise of smartphone users has definitely contributed to how and when consumers are purchasing an item. It is now easier for consumers to learn about new products, compare features, get user reviews and make informed purchases. A quick scroll on social media platforms and search engines allows the customer to research products before they ‘checkout’ from their e-commerce shopping cart or visit their nearest store. An industry report stated that 90% of customers found new products on YouTube while 64% of Indian customers have made purchases based on the recommendation of an influencer or an online review. This in turn has increased a brand’s responsibility to build and retain online brand presence and reputation. While a lot of changes have been driven by the diverse thinking of Indian marketers and the intelligence received from digital analytics, consumer themselves have been instrumental in transforming marketing practices.
Marketers have been constantly focussed on identifying the changing ‘need gap’ in the day-to-day lives of consumers. These changing preferences and the creation of unique needs have contributed to the development of new product lines, evolved features, enhanced services and unique outlets (experience zones) for customers to buy products from. Here are some of the buying patterns of Indian consumers that have developed in the last year and will steer consumption in 2023 as well:
Investment in appliances that provide comfort and convenience
During the pandemic, for a large number of families, disposable income increased, given the curtailing of expenses beyond the home. This led consumers to make investments in appliances and gadgets that make their homes comfortable and convenient. A report on the Indian consumer economy this year showed that the Indian middle class has grown from 14% in 2005 to 31% in 2021 and will be 63% by 2047. This explains why dispensable income has been recorded as the biggest driver of increasing spends on household appliances.
Another interesting thing to note here is that even with people going back to their normal lives, this trend has not retracted. As the cost of living continues to rise faster than the growth of income, more family members take up jobs to lead an abundant life. This has led to an uptick in the demand for home appliances that ease household chores to allow time for rest and recreation. smart integrated appliances that can be accessed by mobile phone applications, automated electronics, and intelligent cooling systems. These have therefore seen great momentum in the last two years.
A growing interest in new categories of electronics
While traditional home appliances have remained in demand consistently over the last decade, there has been a noticeable affinity towards newly launched appliance categories. Products like air purifiers, dishwashers, and robot cleaners have been considered by customers as new enablers in today’s times. This has encouraged industry players to build capabilities to cater to the demand of this niche category as the market for these products is new yet fast-evolving. A deep dive into the consumer’s psyche has shown that a major part of this demand is driven by swipe-up and carousel advertisement posts and endorsements made by online influencers. That brings us to the next point.
Preference for social and digital platforms for making informed purchases
Advertisements of today had to go through a huge shift in the last few years due to an increasing preference for subtle marketing. Advertisements that simply talk about the brand and its offers have been receiving a ‘swipe left’ by most of the customers. Instead, brands that partner with popular and relevant influencers have been receiving great attention by allowing consumers to look at the ethics and purpose of the brand. Brands that offer products made indigenously with environment-friendly methods by tapping local talent have recorded encouraging off-take and brand shout-outs on public platforms. Moreover, the social media algorithm has also been pushing products and services that have received massive popularity or match companies similar to the frequently visited pages of the Consumer.
While the above point suggests that customers are researching online, there is a shift in buying behaviour. Not all customers are buying online, as more offline stores continue to offer evolved buying experiences. According to a research, 45% of Indian consumers browse online but purchase offline. More brands are now offering experiential brand outlets for customers to have a physical interface with products, especially while making high-end purchases. This trend is here to last, as offline shopping for customers continue to be a means of spending time outside the home with themselves or their families. In the Consumer Durables industry, while the online contribution of sales went up from 20% (pre-Covid) to 30% (during Covid), in the present scenario it will settle down at 25%.
Payment methods move from debit to credit
According to industry reports, 80% of individuals in India are keen on saving money due to the sudden spike in the costs of living. These include a variety of fixed and variable expenses like accommodation, food, electronics, travel, education, and so on. Hence, affordability has become a very important parameter for customers while adding their desired products to their wish lists.
Easy instalments, buy now – pay later, percentage discounts on using particular credit cards or payment gateway, cashback incentives, and vouchers have become a part of every purchase decision made by the customer. Consumers have moved to making purchases on credit rather than shelling account money from the savings account in one go.
Continued focus on health and hygiene
An increase in time spent on social media has also provided customers with access to information that they did not have before. By being able to connect with doctors and health experts online, customers are regularly sensitized on ways in which an individual’s health is getting impacted. This has created a great emphasis on products that help in keeping consumers healthy and increases the overall hygiene quotient of homes. The consciousness that began with choosing organic products and supplements has trickled down to the purchase of products like air purifiers, appliances with germ-killing features, and surface disinfectants. As a result, brands are now innovating to offer advanced health and hygiene features that appeal to the evolved wellness needs of consumers. 2023 will be the year for care, convenience and comfort.
The author is the vice president and head of marketing of Voltas Ltd