COVID-19: CHANGING CONSUMER BEHAVIOR

COVID-19 has without a doubt changed business as usual. It’s spread has forced every industry to rethink its business models, product offerings, and even how to transact with its customers. Before the pandemic, supermarket chains offered same day curbside pick-up and delivery for orders placed online.  Today, as a result of crushing consumer demand, those same online orders won’t be ready for pick-up until seven days from now.

It is no surprise that the effects of COVID-19 have created a surge in mobile commerce. And with these new developments not going away any time soon, three important questions are emerging which retailers will need to understand and respond:

For all of us living in this global pandemic – nothing is normal.  For retailers and their business partners, the collective No.1 focus is the safety and well-being of families, customers and colleagues.  After that, they turn to the business. 

Industries like the convenience and fuel retailing channel  have been investing in digital transformation initiatives with solutions like mobile payment apps, mobile kiosks, self-checkout, order ahead, curbside pickup and home delivery initiatives, and a commitment to monitor and understand consumer engagement. And while some may believe that the  shift in consumer behaviour from COVID-19 is temporary, it’s worth noting that other crises have permanently changed our lives—like airport security and baggage screening, after the US terrorist attacks on September in 2001. If you have a hard time wrapping your head around all of the potential impacts of COVID-19, think about this: 

Once consumers have experienced the benefits of mobile payments and touchless commerce as a necessary means to obtain food, beverages, fuel, personal care, household goods and medical items, will they switch back to their pre-COVID-19 behaviors?

How Are Retailers Responding?

The Fuel Retail Industry

Saying Thank You
A fuel retailer in Asia-Pacific is doing their part to say thank you to essential workers who need to be out on the road. By downloading their mobile app, consumers gain access to mobile app pay at pump, and take advantage of a 10 cents off per litre discount for the entire month of April. Consumers unfamiliar with the app are given clear instructions on how to download it, including adding a payment method. At the heart of this campaign is compliance with COVID-19 rules, such as social distancing and reducing cash handling. If their consumers just need to fuel, this retailer is using digital technologies to keep them as safe as possible, while rewarding with a significant discount.

The Convenience Store Industry

Contactless Delivery
A leading convenience store in North America with high adoption of their mobile app due to features such pre-order, pre-pay and delivery, is seeing a significant uplift in transactions since the threat of COVID-19 surfaced. Now with consumer concerns over social distancing, they have added an additional feature and option of contactless delivery, allowing consumers to have their products left at their front door by the driver. Similar to the fuel retailer, they are rewarding consumers who choose this option, with free delivery for the entire month of April.

The Quick Service Restaurant (QSR) Industry

Curbside Pickup for Trucks
As more rest stops and restaurants close each day, it leaves millions of truck drivers with little to no options for food while on the road. A leading QSR in North America is allowing drivers to order ahead and pre-pay, and collect their order in a designated trucker curbside pick-up area. This new mobile app ordering system is a huge step forward for truckers, showing that this particular QSR is keeping a pulse on consumer needs, and innovating to help those critical truck drivers during the COVID-19 pandemic.

What the Future Holds

No one knows how long the current crisis will last, but COVID-19 has changed how consumers want to do business . Consumers will continue to seek digital capabilities and experiences from retailers and brands that  have a positive impact on their lives. These new digital experiences are already showing a 42% increase in online shopping, a 13% increase in click and collect, a 12% increase in ordered takeout for the first time and 19% ordering takeout more frequently.  

So, we must ask:  Are these new behaviours becoming part of everyday life?  And If so, how will convenience and fuel retailers compete without them? If the answer is yes, then we must be prepared to do one thing: change. Change requires a deep look at the people, processes and technology needed to prepare for the future. It requires a serious look at what inside the business model needs to be adjusted or all together scrapped. And finally, it warrants a serious discussion regarding what life lessons were taken from the experience that will help drive future events.

Mobile Commerce (mCommerce): a channel that helps curb the spread of COVID-19, and a digital initiative retailers are working on at rapid speed to accommodate the shift in consumer behaviour.

Even during a pandemic, keeping a pulse on consumer behaviour is imperative. Interestingly enough, it’s during these times when consumers create new habits. By building upon existing digital technologies, innovating, and listening to consumers, retail merchants will mitigate the risk of falling behind. We are likely to see an acceleration in the depth and breadth of “contactless” click and collect and home delivery services, and retailers realize the criticality of servicing a need and desire, forged out of the adversity of COVID-19.

COVID-19 has reminded the convenience store industry about something they’ve known for a long time.  In the future, investing in brick and mortar won’t get you as far as investing in digital initiatives that let you connect with consumers.  Today there are many convenience stores that aren’t getting much use. It’s time to invest in initiatives that create awesome digital experiences for consumers. If we don’t disrupt our business model, someone else will. 

About P97

P97 Networks provides secure, cloud-based mobile commerce, in-vehicle payments, and digital marketing solutions for the convenience retail, fuel, and vehicle manufacturing industries under the brand name PetroZone®. P97’s mCommerce solutions enhance the ability to attract, engage, and retain customers by securely connecting millions of individual mobile phones and connected cars with merchants using identity, geolocation-based software that creates a unique mobile consumer experience. For more information, follow us on Twitter @p97networks or visit www.p97.com.

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