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The familiar stranger- Emerging face of new consumer

To understand the various consumer behaviors changes taking place, Russell Reynolds Associates spoke to some leading consumer sector CEOs in India from respected companies and these discussions led to some amazing lessons from this crisis...


ET Brand Equity | July 29, 2020


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The ET Brand Equity website published the article, “The familiar stranger- Emerging face of new consumer,” written by Russell Reynolds Associates Consultant Pankaj Arora​, based on our paper, "Navigating the Perfect Storm: Leadership Lessons from Indian Consumer Sector CEOs." The article is excerpted below.

People have experienced wars, social unrests, health crisis, economic crisis and similar, but often their impacts were more localized, not like the world we live in today where working from home is not just an employee friendly policy in the handbook but the way of life, and a casual meal with friends in a restaurant feels like a lifetime away. 

With most households experiencing a decline in their household incomes, compounded by the insecurity around economic revival and job cuts, it is fair to say that the consumer se​ntiment index is sharply leaning towards an all-time low. The fall in disposable incomes and purchasing power and a general anti consumerism sentiment, accentuated by an appreciation of glimpses of a simpler life and cleaner environment during lockdown, have in general triggered the demand for essentials and “value products” rather than “value added products”. The conservative Indian consumer from a few decades before is back once again in prominence. 

To understand the various consumer behaviors changes taking place, Russell Reynolds Associates spoke to some leading consumer sector CEOs in India from respected companies including Britannia, Hindustan Unilever, L’Oréal, Marico, METRO Cash & Carry India, Walmart, Whirlpool and these discussions led to some amazing lessons from this crisis.

Key takeaways from these conversations include significant transformation in areas such as consumer behavior, business models and leadership styles and talent implications. Few of the insights are highlighted below: 

Smaller packaging in demand

With most households experiencing a decline in their household incomes, compounded by the insecurity around economic revival and job cuts, it is fair to say that the consumer sentiment index is sharply leaning towards an all-time low. The fall in disposable incomes and purchasing power and a general anti consumerism sentiment, accentuated by an appreciation of glimpses of a simpler life and cleaner environment during lockdown, have in general triggered the demand for essentials and “value products” rather than “value added products”. The conservative Indian consumer from a few decades before is back once again in prominence. While essentials are trumping discretionary spends for now, another interesting trend, somewhat contradictory, is emerging in terms of pack sizes wherein relatively more affluent consumer, who looks to minimize frequency of shopping trips and exposure is gravitating towards larger pack sizes, while the relatively less affluent consumer with the strain of finances is being frugal and opting for smaller packs wherever possible. 

Health, hygiene and nutrition leads the pack

This trend has leapfrogged during the past few months and if one goes by the experience of countries which have opened up much ahead of India, this is likely to stay. The “going concern assumption” which has been the foundation of most of our lives has been challenged and the risk of more such pandemics have jumped out from fiction books and staring at us as a realistic possibility. The only defense one has is a disproportionate focus on health, hygiene and nutrition, and our insights suggest a lot of this will come on the back of traditional home remedies, natural products and rapid development of the nutraceuticals market. At the same time, COVID-related products like sanitizers, masks, disinfectants and similar products will find a more permanent place in shopping lists. 

To read the full article, click here​.