As the whole world begins to slowly recover from the COVID-19 crisis after a year and a half since it first struck, it is clear to see that the period of lockdown has had a very serious impact on several aspects of how humans live. Not to mention the economic instabilities it has created, but also the way it has transformed the way humans work, shop, and even carry out businesses. With economic instabilities, consumers are also experiencing a transformation in behavior.
In times of crisis, consumer behavior surely tends to change, as indicated in previous research. Past epidemics, namely SARS and MERS, showed a trend called “economic elastic behavior”, where people postponed their spending and focused mainly on essential goods. Nowadays, research also shows that consumers have, as well, become more mindful of the things they buy. They strive to limit food waste, shop more affordably, and buy more sustainable options.
We are now seeing new behaviors surfacing across eight areas of life; namely, the surge in e-commerce, changing of brand preferences, as well as the higher unemployment rate.
The COVID-19 pandemic has forced us, humans, to new ways of doing things, modifying existing practices, and transforming entire ecosystems for such a short period of time. Therefore, the next big question in modeling consumer behavior is: Will habits reshaped during times of crises continue, or will people return to their old routines once circumstances change?
According to research, consumers will most likely divert to new ways of doing things if they are more convenient, affordable, and accessible; as the e-commerce sector has, as well, responded vastly to the challenge of creating positive outcomes in response to the pandemic. Referring to a survey conducted in early 2020, many consumers were likely to continue buying online for non-health reasons; such as convenience, easiness, as well as wider product ranges and choices. Therefore, through creative solutions such as a “digitalization of buying”, new ways of consumption are invented and thus conducted, while the old traditional ways are discarded. It is now clear to see that in this “New Normal” era, technology and digital media platforms are set to play a greater role in reaching out to consumers, creating a buzz, as well as facilitating transactions and retention of customers.
In conclusion, the COVID-19 pandemic has changed the world we live in, as well as our behavior as human beings. However, changes that provide us positive outcomes and experiences are most likely to last longer, especially those driven by convenience and well-being, such as digital adoption, value-based purchasing, as well as increased health awareness. Therefore, it is very important for insurers to understand consumers’ preferences to stay relevant and to adapt accordingly.