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February 4th, 2021

There is no doubt that COVID-19 has inevitably changed consumer habits in the FMCG world. Amidst a third national lockdown, and with a vaccine in motion, longer term impacts are becoming clearer every day. From a vast growth in e-commerce to an increase in older consumers, here at Futures we’ve taken a look at a summary of changes and how brands can best adapt and respond.

 

Rapidly growing e-commerce

Kantar data recently released stats showing a 75% increase in UK grocery sales through digital channels. Unsurprisingly consumers have been purchasing online to avoid the obvious health risks presented by the pandemic. Brands associated with health and personal hygiene have seen a particular rise in performance with 79% of consumers anticipating the pandemic to increase their focus on health and wellbeing. Recent data indicates that this increase in FMCG e-commerce will become a permanent change in consumer behaviour.

Building both adaptable and flexible channels to meet the shift in demand for e-commerce is crucial for consumer goods brands to be able to maximise on this opportunity. Now is the time to review your omnichannel strategy in order to ensure your brand is innovating and moving to adapt to the digital surge.

 

A digital divide

The consumer goods industry have long understood the importance of the digital channel however the rate of adaption has never been close to this scale or sense of urgency. As statistics on the impact to the consumer goods industry become more readily available, a digital divide is becoming more prominent in brands with stronger digital capabilities reaping the benefits, and those on the weaker side playing catch up and quickly losing consumer interest. Digitally strong brands who have the resource to respond to delivery demand with enough slots and the option to book in advance have been able to experience heavy growth in e-commerce sales figures.

We’re also witnessing a rise in consumer goods subscription services and as consumers experience the ease and convenience, this trend could certainly be here to stay. Among brands innovating in this way, smol launched their successful subscription service for laundry detergent and witnessed interest in their products triple since the start of the pandemic. They are now the leading detergent subscription service in the UK as well as the fastest growing laundry brand.

Our take on this is that innovation has never been more important and now is the time for bold business transformation with a focus on digital capability for FMCG brands.

 

The rise of older consumers using online channels

Market penetration has doubled for older consumers shopping online during the pandemic. As their experience using digital channels increases, we suspect that these older consumers are more likely to continue shopping online in the future as they become accustomed with this method of shopping. Mintel found there to be a 27% increase in the 65+ age category shopping online since the crisis. This figure was merely 16% in May 2019 for the age category to shop online at least once a week and it now sits at 43%. It is definitely worth FMCG brands bearing this in mind when thinking about targetting new business from consumers in this bracket.

 

If there was ever a time for bold business transformation from FMCG brands – it’s now.

 



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