Spending on kids adapts to an ecommerce-first world

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COVID-19 is affecting how families shop for kids as families adjust to new economic realities imposed by the virus, but also as behaviour changes as a result of fewer impulse buys being driven by children in stores, more e-commerce and more concerns about supply chains for essential goods, like baby formula and diapers.

Tandy Thomas, associate professor and distinguished faculty fellow of marketing at Queen’s University, says it’s incumbent upon CPG brand supply chains to stay open for parents who want product, find out pain points for customers and do what they can to reduce those, while using community building and reassurance messaging.

Direct to consumer models can work in some cases, she says but it doesn’t fit well with most distribution structures and might require building new ones for legacy brands. Thomas says that as parents are adjusting to buying more products online, those that require in-store testing, like strollers, may suffer.

thomas-queensBut kid-friendly companies are reaching out to parents in new and different ways, like Toys “R” Us Canada, which recently launched Stay-At-Home Play with 12-year-old ambassador Méganne Dagenais that includes a “Wash Your Hands Challenge,” a hand hygiene singalong.

Grocery is going to see a big change too, she says, with parents making more meals – not just because of restaurants being closed, but also perhaps because of not being able to take advantage of school lunch programs. Convenience foods like frozen pizza or lasagna could see an uptick, as working parents have more demands placed upon them as they balance working from home with child care.

And the older the children, Thomas says, the more likely they are to be engaged by parents in online shopping. Previously, she says, a family might’ve gone to the store with kids in tow, who would’ve been influencing purchasing behaviour that way. Parents are likely doing online shopping by themselves, so it’s more parent-controlled, especially for younger kids.

Most parents that have kids to watch at home might not have time to stand in line outside a grocery store, she says, and will be forced into the many that have tried grocery delivery and there will be many of them realizing the convenience and will continue using it.

In the apparel sector, for children’s wear, what friends are wearing is still a very influential component, even if interactions between kids is now exclusively virtual. Many of those kids were interacting with each other anyway before COVID-19 through online forums like TikTok, Thomas says. “Peer pressure will be there, but accessibility will change. A big change retailers have had to adapt to, is that “There is no longer en masse mall shopping [by teens].” Thomas believes other categories could have already taken up the mantle when it comes to peer pressure, like online games and apps.

According to Thomas, normal triggers are no longer in play in a COVID lockdown economy – like spring for new shoes and raincoats. Cyclical triggers like these make people go and update their wardrobes or supplies, much like back to school in the fall. “Now, there are no triggers. People don’t even know what day it is,” Thomas jokes.

“With a bit of luck, the world will open up, and we may see a surge in things that require trying things on,” she says. However, at least for now, we will see a decrease.

Thomas says in this environment there might be a sales uptick in stuff to keep kids busy. “Anecdotally, I am seeing an increase in Crayola ads in my feeds,” Thomas says. She believes activities that keep children engaged in the home, whether through gaming, toys, streaming services or “crafty activities” will see a rise in demand, and could be a relevant approach to reaching parents across categories.

“My speculation would be that we are going to see increases in the kinds of products you need to keep children occupied, whether free or costed online services, but also with younger kids, markers, glue, construction paper,” Thomas says.

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