The New Normal After Covid-19
Challenges & Opportunities for the Physical Retail & Payment Industries
The new normal is here to stay.
The ongoing Covid-19 pandemic has a huge global economic impact without a doubt. It is also reshaping the way societies work, learn, consume and socialize. Fear started to shift the consumer behavior as it is a very powerful psychological factor. These two questions hang in the minds of many stakeholders in the retail & payment business today: How is the consumer behavior changing What is the new normal in consumption
People all around the world are now avoiding cash as the Covid-19 virus can live on banknotes for days and spread the disease. ATM transactions go down, contactless payment methods rise customers do not want to touch cash, merchants do not accept cash.
As far as the banking industry is concerned, it is the rise of digital banking faster than ever. Customers want to be able to complete all transactions without going to a bank branch. Traditional banks are improving their digital channels. Fully-digital challenger banks are trying hard to keep their heads up with their core strength as consumer trust is leaning towards large financial institutions . The battle to win the new-online customer will surely continue . In addition to this, the players in the banking & payment industry will clearly face fierce competition to win wallet share in customer expenditures that have already shrunk due to unemployment and necessity-focused shopping only to save for the rainy days.
Digital shopping platforms are gaining customers obviously people shop more on online platforms as they stay home avoiding contact with other people as much as possible.
Covid-19s impacts have changed consumer behavior and it will be a different game in the offline world. Customer expectations will be quite different from where we left it off. To make up for the losses during stay-at-home periods, the companies in all industries will be more focused on campaigns and offers. It will be hard to capture and win the consumers that will be flooded with a lot of campaigns communicated via all channels. It will be the battle for wallet share.
In the new normal, health is wealth. The customers will definitely not forget the long days spent in lockdown. Therefore when it is time for shopping, it will be more to the point, rather than loitering in the shopping venues for hours. Knowing your customer, personalization and real-time interactions will be critical. Here are a few food for thought actions, applicable to several industries; payment & banking, loyalty platforms, retail, e-comm, etc.
- Engaging the customer while in own/partner stores and reminding offers to increase basket size
- Capturing the attention of a larger set of customers that are spending time in stores offering similar items with personalized offers to invite them to own/partner stores
- Reminding customers about payment platform offers when theyre about to make a purchase to influence them to use own platform
- Retarget customers with abandoned products in their online baskets while in an offline store offering similar items
Covid-19 will surely cease its impact. Today no one can predict when, but we will get there eventually. Countries are announcing their normalization plans and preparing the economy and the society for the post-Covid times. The companies that understand their customers the most and adapt to the changing customer behavior will be the ones that will survive the global economic crisis by winning the battle for the wallet share.