The global pandemic came with unprecedented health and economic crisis, ravaging businesses and causing almost a halt in economic activities.
With the world embarking on various measures to limit the spread of the virus, there has been a drastic shift of consumer’s preference, pattern and behaviour, thereby, making it pertinent for businesses to adjust their strategies in line with the change.
Back home in Nigeria, the gospel is no different than for businesses to survive in the trying time, it must constantly innovate new ways of delivering quality services at the fastest, easiest and safest possible means to customers.
This would enable them to build strong consumers loyalty for their brand and place them on a solid footing to surmount the headwind.
In a webinar put together by the American Business Council, (ABC), in partnership with MasterCard, experts say businesses must respond in line with changing consumer behaviour. Policymakers also have a role to play in ensuring that businesses thrive despite the challenges.
The webinar drew from the wealth of experience of Bola Asiru, principal/divisional lead, Mastercard Advisors, Sub-Saharan Africa; and was attended by top business leaders and policy experts.
Here are a few insights from the conference.
Rising preference for cashless payment
Cashless payments have gained increasing traction as consumers and businesses search for more ways to limit the exposure of contracting the virus.
There is also the “psychological factor” of people thinking of cash as unclean and this is driving consumer’s behaviour to towards card, digital and contactless payment.
This shift to cashless payments has resulted in positive growth for financial services, according to Asiru.
Despite a 6 percent GDP contraction, Nigeria’s financial services sector posted its strongest growth in more than a decade, growing 28.41 percent in the second quarter of the year from 24 percent growth in Q1’2020, data from the National Bureau of Statics show.
The volume and value of POS transactions surged to a 4-year high of N416 billion in July. Mobile transactions (inter scheme) also reached their highest levels in 4 years at N275 billion. This growth in the use of digital and mobile platforms had a positive growth impact on the telecommunications industry as the sector expanded by 18.10 percent from 9.71 percent in the previous quarter.
Growth preference for Ecommerce
Ecommerce platforms have become the norm for a fast-growing category of consumers who want convenience, speed, and safety; and the pandemic has resulted in a boom for players in this industry.
As consumers embrace social distancing and limit physical options amid the pandemic, there has been significant growth in eCommerce, according to Asiru.
Cross-Border shoppers limited by travel restrictions have also taken to eCommerce platforms as an alternative to foreign shopping trips, he said.
Consumers focus on essential
Asiru explained that majority of Nigerian consumers remain cautious about the COVID spread hence, focused has largely been on ensuring stock of food, health care and other essential products to prepare for potential supply disruptions.
As a result, luxury and non-essentials have taken a back seat in terms of consumer preference.
Digital replacing physical
Due to the pandemic, physical work, entertainment, education lifestyle and networking needs are migrating to digital channels.
Online learning, music/movie streaming and work from home have become a viable alternative to physical activities.
Health first
Not only is the pandemic shaping payment patterns, but it is also increasing consumer’s awareness on the need to put health first.
Since lifestyle diseases such as cardiovascular, diabetes, high blood pressure amongst others have been identified as a catalyst for COVID related deaths, consumers are increasingly investing more in exercise, physical activity and healthy eating.
Courier & Delivery Services trust shift
As a result of increased penetration of structured professional delivery companies, courier/delivery companies are forming partnerships with trusted brands including pharma, grocery and food; for improved convenience.
This has helped in boosting consumers trust in couriers/delivery services.
Implication for Businesses
As the pandemic forces a huge change in consumer’s behaviour and consumption pattern, it is important that businesses move in line with trends.
Asiru in his presentation highlighted several areas business must adjust to meet with changing shift in consumer’s behaviour. This approach, he said, is grouped into three from strategy revalidation to data analytics, and marketing and customer engagement.
Strategy Revalidation
Asiru explained that businesses must revalidate their strategy and budget to ensure it is relevant to changing customer behaviour.
They must also revalidate strategies to embed digital. They also must construct their long term strategy with tactical action plans that respond to an unpredictable market.
Accordingly, they must constantly innovate by deploying dynamic business models via partnership and alliance.
Data & Analytics
To move in line with consumer’s consumption pattern, businesses must ensure that decision making and strategic bets are data-driven.
Businesses should invest in predictive analytics platforms like propensity modelling, to model future trends and also as a hedge against unpredictable times.
Conclusively, as digital traffic increases, cybersecurity and fraud prevention platforms are also critical for businesses.
Marketing & Customer Engagement
Businesses must create multiple engagement channels for repositioning products and services. They must also develop an obsession with understanding every step of the customer journey and how the business can add value.
Positive consumer’s behaviour should also be rewarded in terms of discounts on cash payments.
Finally, marketing/communication spend by businesses should align with consumer engagement preferences
