Brand switching may be a threat to certain categories

A report finds that shoppers are favouring price over brands they trust in categories like clothing, electronics and even CPG.
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The COVID-19 pandemic has resulted in a number of new consumer behaviours. But there are also some spending shifts that brands should expect to stick around, according to a new report by Publicis Groupe’s digital consultancy Publicis Sapient.

Nearly three-fourths of respondents said they have shopped more from home over the last three months, with 48% saying they expect their online shopping habits to continue into the future. But what consumers are shopping for online has seen a notable change.

Economic uncertainty has, understandably, made consumers delay “discretionary” spending, which not only includes “big-ticket” items like cars, home furnishings and electronics, but also new clothing, despite the fact that the category is typically the one consumers said had previously made up the bulk of their online purchases. Respondents in North America said clothing was the product category they had de-prioritized the most, a trend that is likely to continue until stability begins to return to the economy and job market.

Clothing has also been the category most impacted by “brand switching” over the last three months – for those who have made clothing and accessory purchases, economic uncertainty has driven them to shop based more on price and a newfound willingness to try new things, as opposed to buying from a brand they trust. This trend was also seen in other discretionary categories, such as beauty, electronics and household decor – as well as CPG categories like packaged snacks and pantry staples, where availability has persisted as a major decision driver.

To deal with the new ways loyalty impacts purchases, Publicis Sapient emphasized the importance of data. While loyalty programs were a big driver of shopping decisions, respondents expressed dissatisfaction with things like personalized offers, suggesting brands can use what they know about shoppers to better meet their needs beyond offers and promotions.

One way to offer them something more personalized could be through at-home experiences.

The report found that 81% of consumers tried at least one new hobby over the last three months, with home improvement projects and learning to cook leading the way – Canadians were just as likely as those in other countries to try home DIY projects, but slightly more likely to improve their culinary skills. Canadians were also more likely to try planting a garden for the first time.

People most often turned to YouTube in order to learn about their new passions – compared to something like trying a new restaurant for take-out, where they more often turned to social media. The report suggests this is because videos more closely mirror in-person learning experiences and classes, perhaps giving these kinds of concepts staying power as people become accustomed to learning at their own pace.

Brands have a role in helping people advance these hobbies: consumers were 31% more likely to purchase from companies that offered this kind of content themselves. The report also suggests that, with consumers pursuing their hobbies within the home, tapping into unstructured data like social media conversations is the best way to keep up on sentiment and stay ahead of demand and trends.

Publicis Sapient’s report polled 3,000 consumers across markets including Canada, the U.S., U.K., Australia and Singapore.