Consumer behaviour & Its Effect on Businesses

Consumer Behaviour & Its Effect On Businesses
Webinar
25.03.2021

People make the economy go round
Changing behaviours
Key sectors
Automotive
Retail
Consumer tech
At home ﬁtness
Healthcare
Conclusions
Content
CONSUMER BEHAVIOUR & ITS EFFECT ON
BUSINESSES

People Make The Economy Go Round
1.74 million people are unemployed
The Oﬃce for Budget Responsibility (OBR) expects 2.2m people to be
unemployed at the end of this year, or 6.5% of all workers.
Understand customer expectations
We have unearthed that brands should focus their efforts on understanding
customer expectations, addressing pain points and their wants and needs.
Juxtaposition in the economy
Customers are delaying spending (e.g. motors, moving home,
holidays) and their purchase needs are changing, moving from out of
home to in-home experiences (e.g. in dining, ﬁtness, alcohol
consumption)
CONSUMER BEHAVIOUR & ITS EFFECT ON BUSINESSES

❖ Pinpointing the challenges and changing
environment of the consumer helps identify the
drivers of behavioural change.
❖ A change in employment status or job security may
inﬂuence behavioural change.
Changing Behaviours Calls
For A Changed Approach

Understanding the context of changing behaviours
In contracted full or
part-time employment
(furloughed or
otherwise)
Unemployed or full
time student (not
working)
Retired
In self-employment,
temporary or self
employed work
Source: Rare Consulting. UK Adults 18+. Data Collected 22nd February - 21st March 2021 (N=1,006).
Q4 - Which of the following best describes your current employment?
Base: full sample (N=1,006). Full data tables available from www.rare.consulting
31% Excluding those retired - close to one third of the population currently
out of work, or in self-employed or zero hours / temp contracts

Job Security
VERSUS
46%
54%
Of people are
concerned about their
job security
Of people are not
concerned about their
job security
Q5 - To what extent are you concerned about your job security?
Base: those in employment (N=871). Full data tables available from www.rare.consulting

KEY SECTORS
● AUTOMOTIVE
● RETAIL
● CONSUMER TECH
● FITNESS
● HEALTHCARE

Automotive
❖ Remote and online viewing and purchase of cars
isn’t a new trend, however, COVID-19 has
accelerated this trend to the forefront of
customers minds.
❖ Digital disruptors such as Carwow has increased
direct dealer competition, allowing consumers to
broaden their search radius through video
meetings and remote purchasing capabilities.
❖ Innovative organisations such as CitNOW
provide app based video solutions for
manufacturers and retailers to create a more
transparent and easy car buying experience for
their customers.
Consumers were already steering the
direction of this sector

Automotive
84%
84% of car buyers who had already
received a video from a retailer find it to be
a valuable part of the customer experience
77%
77% of retailers are concerned about how
the increase in e-commerce may affect their
ability to build relationships with
customers.
Source: CitNOW - “Accelerating the Digital Customer Experience” - 2021
(https://www.citnow.com/resources/accelerating-the-digital-customer-experience-2021-report/ )
29%
Of the UK population purchased in
the automotive sector in the past
12 months

Are Local Dealerships Needed?
of car buyers in the last 12 months were
done almost entirely virtually, which
actually outstripped performance of
entirely in person dealings
Hyper-personalised approach to
sales and aftercare for local retailers
and dealer networks
Viability of a nationwide delivery
strategies, seamless UX and
purchase process for national
retailers and manufacturers
44%
Base: those who purchased in the automotive sector (N=293). Full data tables available from www.rare.consulting
The Opportunity
88%
of car buyers in the last 12 months who
purchased entirely virtually and had the
vehicle delivered to their door agreed “I
enjoyed the experience and would
want this method to continue”
200+
The physical number of
Volkswagen showrooms in
the UK

❖ Engagement in the retail sector has decreased
as lockdown has continued and despite people
wanting to shop locally, more people are
purchasing from large corporate stores such as
Amazon.
❖ Brands in the retail sector need to be dynamic to
customer behaviour, sales in apparel are low
and so expanding the offering to include
hobbies and interests may be beneﬁcial as last
week 19% of men and 20% of women purchased
items relating to hobbies and interests at least
once.
❖ Offering a subscription based service may also
be beneﬁcial as seen with the likes of Hello
Fresh, who doubled their revenue in 2020.
Retail
75%
Of the UK population
purchased in the retail sector
(non-food) in the past 12
months

Retail
The £19.5bn that UK customers spent at Amazon in 2020 is roughly double the takings at
Marks & Spencer, the 137-year-old retailer, and underlines how the Covid-19 pandemic is
revolutionising the way we shop and threatening the future of the high street.
We found that 46% of the population have bought products relating to DIY, gardening and
home management more frequently online in the past 12 months.
Another category within the retail sector that we expect to continue with growth is hobbies and
interests with 65% of people saying they have purchased online more frequently in this
category. Suggesting the lockdown causing people to shift their focus on how to spend their
time.
Q10 - How have you purchased items from the retail sector in the past 12 months?
Base: those who purchased in the retail sector (N=753). Full data tables available from www.rare.consulting

Is It Time For A
High Street Revolution?
More available retail floor space at
better rates
Measures such as click & collect,
local delivery, adequate / clearly
enforced social distancing guidelines
and cleaning regimes will ensure
that consumers still prefer to shop
local
The Opportunity
47%
of consumers agree “I prefer to shop
local and I would prefer to continue
doing this regardless of coronavirus
restrictions in the future”
32%
Of consumers also agreed “I prefer
to shop local but I don’t feel safe
to do so”
Base: those who purchased in the retail sector (N=753). Full data tables available from www.rare.consulting

Consumer Tech
Consumers are better connected
❖ Organisations which have been adaptable to
online platforms have been successful during
the pandemic. Organisations which have failed
to do so have suffered, such as Brighthouse.
❖ In the last 12 months, 56% of the UK population
made a purchase in the consumer tech sector.
❖ The necessity of working from home and
providing in-home entertainment has increased
LAPTOPS
GAMES
CONSOLES TV IPAD/
TABLET
ONLINE
GAMES
39% 34% 40% 41%
APPS
64% 53%
Base: those who purchased in the consumer tech sector (N=564). Full data tables available from www.rare.consulting

Consumer tech
What does this mean for brands?
An increase in consumers going online could
mean that there is greater appetite for
ecommerce across a variety sectors.
Globally, shipments for home computers and
tablets increased to 369 million units in 2020.

Tech Rental Boom On The Horizon?
Of parents who have made a purchase
in consumer tech in the last 12 months
have bought an ipad or tablet
Frequency and recency of purchase
has increased amongst many.
With more time spent at home
working, learning and relaxing -
more tech is required - which is
costly.
Renting is easier, more cost
eﬃcient, sustainable.
47%
39% Of adults who have made a
purchase in consumer tech in the
last 12 months have bought a
laptop
Base: those who purchased in the consumer tech sector (N=564). Full data tables available from
www.rare.consulting
56% Of the UK population purchased in the
consumer tech sector in the past 12 months
The Opportunity

❖ Not only are more people walking and running,
more people are tracking their progress with
Strava now having 73 million users. Suggesting
there is more emphasis on stamina and fitness
goals which could overflow into the healthcare
sector.
❖ Despite the government advice allowing more
frequent exercise, it seems that the population is
still only wanting to get their exercise in once a
day.
❖ There has been an increase in the number of
people purchasing fitness equipment for at home
workouts, something many independent gyms
have capitalized on by renting out equipment to
their members.
At home Fitness
Exercising the right to ramble

At home fitness
People are cancelling their gym memberships by the masses
with one gym reportedly losing a third of its customers.
Steppers, weight benches, exercise bikes and cross trainers
are the most popular at home equipment choices.
There are a significant proportion of the population who have become new to the
health and fitness regime in 2020 and these audiences are more likely to stick
with these methods.
Base: those who purchased in the home fitness sector (N=236). Full data tables available from www.rare.consulting
23%
Of the UK population purchased in the at home fitness
sector in the past 12 months

Is this shift here to stay?
Of those that have made a
purchase or taken up home
fitness enjoyed the experiences
and would want this to
continue in the future
Is there for both new & emerging at
home ﬁtness models who have
recruited new customers in their
millions in 2020…
BUT inherently - with consumers
health and mindfulness being of
such a social and personal
experience
We feel those that were already in
the market before COVID will likely
return to gym / class based settings
in the main
44%
82% Of those that have made a
purchase or taken up home
fitness in the last 12 months
have exercised on their own
outdoors (e.g.
running/jogging, cycling etc.)
Base: those who purchased in the home ﬁtness sector (N=236). Full data tables available from www.rare.consulting
The Opportunity

❖ There is a relationship between level of concern
about the Coronavirus and doing beauty treatments
with women and younger generations.
❖ Coronavirus has initiated the population to have
autonomy and control over their own health with
more customers purchasing vitamins and dietary
supplements according to research by Mintel.
❖ With the Coronavirus demands affecting the NHS,
some private healthcare companies has seen a
doubling in the number of people paying for
healthcare treatments, for as long as there is a
backlog for treatments by the NHS, this is a trend
that could continue.
Healthcare
Brushing off the Coronavirus
Sources: Rare Consulting. UK Adults 18+. Data Collected 22nd February - 21st March 2021 (N=1,006).
Base: those who purchased in the healthcare sector (N=262). Full data tables available from www.rare.consulting

Healthcare
Sales in vitamins and supplements have grown by 8% in 2020, reaching a market value of around £500 million, as
health conscious Brits up their vitamin intake during the coronavirus pandemic.
A quarter (24%) of consumers
have taken more vitamins,
minerals and supplements this
year as a result of the Covid-19
pandemic (Mintel).
High proportions of those
to have purchased in
healthcare have sought
online consultations with
HCPs outside of the NHS.
One ﬁfth of consumers (20%)
see themselves spending
more in this sector post
lockdown
Sources: Mintel ( Click here) / Rare Consulting. UK Adults 18+. Data Collected 22nd February - 21st March 2021 (N=1,006).

The biggest opportunities in healthcare
Private medical procedures has
seen particular growth in the last 12
months, HCA Healthcare saying it
has experienced a doubling in
patients self-funding procedures
Medical Aesthetics and
non-cosmetic procedures
Continuing uptake of dietary
supplements and vitamins
(subscription services)
X2
45%
Of those that have made a purchase in
private healthcare in the last 12 months
have sought virtual consultations
with healthcare professionals
outside the NHS
26% Of the UK population purchased in the
healthcare sector in the past 12 months
The Opportunity

Demand and Spend - Around
the Corner
There are clear indications across all sectors that an
increase in demand and spend is just around the corner:
Base: full sample (N=1,006). Full data tables available from www.rare.consulting

Conclusion
“Companies typically fail at disruptive
innovation because the top management
team is dominated by individuals who have
been selected for delivery skills, not
discovery skills”

keith@rare.consulting
+44 (0) 7854 126911
Thanks!

Consumer behaviour & Its Effect on Businesses

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