Surprising shifts in consumer behavior patterns have emerged during the COVID-19 pandemic. I am reading about Nintendo and Lego riding a wave of positive revenue streams while Hasbro and Mattel struggle. Spotify is modifying podcasts offerings. At the onset of the pandemic, consumers bought prepacked ready-to-eat meals. This was followed by a phase where people resorted to comfort food. Now consumers are buying ingredients for home-cooked meals, as more children are at home for the start of this school year. Demand for yeast jumped 600%!
Transaction costs, which are the costs of undertaking trades in the market, have seen a shift. There is an increase in conscious consumption. Americans are saving more; food waste has decreased by 68%, according to Accenture. The demand for store brands has increased. According to McKinsey & Co., gasoline consumption is down, as trips to schools and grocery stores are down. Global consumption of coffee has declined affecting the incomes of coffee growers in Ivory Coast and Rwanda. With Americans consuming less coffee and more of other beverages, Starbucks has begun to sell its Pumpkin Spice Latte earlier than usual. Online shopping is on the rise. Walmart is competing with Amazon for same-day delivery. Instacart is hiring more workers. Local farmers are getting on the online bandwagon and are offering curbside pickup.
Demand for immunity building foods is up; orange sales are up, as consumers consider oranges durable. Turmeric and tea are preferred. Dry beans, like kidney and garbanzo, are on more kitchen shelves. More vegans and vegetarians are emerging as people see wet markets as breeding grounds for viruses.
The food industry is seeing a shift and some of these changes may be here to stay. Cleaner stores, less product variety, and more self-checkout can help establish behaviors and help supply chain managers make reasonable predictions and better handle inventory.
Along with changes to businesses and firms, there is a side to changing behavior that applies to the community. It is striking how communities are coming together; consumers increasingly want to support local producers expressing a sense of caring. Mindfulness and gratitude can help with technology fatigue and social isolation. Growing up in a joint family, I have a sense of how relationships with mentors have helped. Not everything in life is quantifiable. In addition to changing consumer behaviors, I am hopeful the crisis will help us build communities.