By Jane Asscher, CEO, 23red
Bushfires decimating Australia, the fraught finalising of Brexit, and a global virus pandemic – so far, 2020 has been a year of challenges.
For the UK’s older teenagers, the already turbulent world around them has become even more uncertain. Any plans to begin higher education or full-time employment have been temporarily taken away. Instead of celebrating the end of their exams or the start of new jobs with their friends, they are unexpectedly confined to living in extremely close quarters with their parents.
It’s a rare occasion where moaning ‘it’s so unfair’ like Harry Enfield and Kathy Burke’s characters, Kevin and Perry, seems more than reasonable. Their experiences of this time will live long in the memory – our teenage years are a crucial for formulating not just music or fashion tastes, but what products we buy, to what careers we aspire and to which brands we become loyal.
The pandemic and its knock-on effects – such as increased ecommerce, the limited availability of certain products, and the shift towards leisure activities within the home – has forced many Gen Z and millennials to reconsider their retail purchases.
According to research by global commerce services company PFS, 32 percent of Gen Zs and 35 percent of millennials have tried new online retailers because of the lockdown and intend to continue to shop with them because of the good experience they’ve had.
The longer we stay in lockdown the more likely it is that these habits will stick, and younger, more impressionable shoppers will evaluate their previous levels of consumerism. They will consider more carefully the quality of what they are buying, how long it will last and, perhaps most importantly for retailers, from which ones will they buy.
The ethical tide began turning some time ago. In a piece published on the 13th of January, Campaign reported, ‘The UK spent more than £83bn on ethical goods in 2017, up 3.2% from the previous year. […] The growth of this market has been driven by increasing environmental concern, particularly among young people.
A more recent PFS report, revealed ‘over half (54%) of UK online shoppers report they will be less likely to spend money with brands and retailers in the future that have treated their staff poorly during the coronavirus.’
Following the crisis, retailers will need to respond to the increasing demand for ethical goods and better treatment of staff. They will need to revise their product offer between now and stores reopening across the UK because pre coronavirus sales expectations will no longer be accurate.
A specific but far-reaching example is audience profiling – will ‘Trendy Tessa’ still buy the latest and greatest of your product range the day it comes out? In short, no. She will be experiencing her first recession and focusing on the essentials, or at best, very carefully choosing occasional treat purchases.
Brands will need to gain new insights into their customers’ needs, to understand how they have changed and create offers accordingly.
Of course, the retail sector is dealing with its own issues. Many can’t pay landlords their rent and huge numbers of British businesses, new and old, will need to be restructured. But if they can realign with a newfound understanding of what their customers want, and can deliver it with sensitivity, they will be best placed to move forward with robust and successful brand building.
In a recent piece for the Financial Times, Mary Portas wrote, ‘The retail businesses that will survive, the ones who will come out with a deeper connection to their followers (note I don’t say consumers: the days of rabid consumerism are over), are those with hard-earned brand equity.’
Millennials and Generation Z will not be the big spenders when the pandemic is over, but they remain the core of a new generation of consumers. Their heritage brands are being formed right now and they will expect them, more than ever, to help create a safe, healthy and environmentally friendly future.
Brands must look in the mirror during this time, ensure purpose is at the heart of everything they do, adopt sustainable practices and practise what they preach if they have a chance of appealing to the consumer long after lockdown ends.