Investors are well-advised to track the supply side as carefully as they are tracking the consumer side

CoronavirusCovid-19

Marketers and investors are increasingly wondering how consumption will change post covid-19 and the lockdown. The obvious answer is that everyone is going to be less well off, and consumption will shrink. In an earlier column we modelled the amount at risk.

People will spend on necessities first (could include replacing a broken phone or refrigerator, not just food and school fees). For getting a piece of the “nice to have but can do without” expenditure, there will be a fierce cross category battle (buy an iPhone now, paint your house next year or downsize the wedding and give the newlyweds a car instead).

The Indian consumer toggles seamlessly between ‘stretch’ and ‘settle’ behaviour—in good times, “whatever I can afford plus one price-performance level up” (stretch) and in bad times “let’s stay with the most manageable price-performance point” (settle). We have seen all this before in earlier downturns, no surprises here.

But there also seems to be a hypothesis developing that this never-before experience may change Consumer India’s DNA permanently. If I had to pick a number on a 10-point scale where 10 is significant transformation and 1 is kuttey ka doom (the proverbial dog’s tail that always goes back to the original curl), I would pick 3.

Some behaviour changes will happen, but with a twist. Will we offer household help liberal salary hikes because we have experienced their workload and our dependence? Probably not. Move to a do-it-yourself fully gadgeted home? No. But we will buy insurance with options like cleaning robots, or even buy gadgets for helpers to use to better clean the dirty places we discovered during our house arrest.

What about digital becoming the primary way of life and living for all? Global investor and author Ruchir Sharma recently wrote that things we expect to happen post-covid were already happening pre-covid—covid is just “telescoping the future”? Moving to digital ubiquity had already begun —thanks to Chinese phones, the cheapest telecom rates in the world and even temples going online! The momentum multiplies.

Increased health and cleanliness focus? We have created a caste system in that too; ever noticed how, before masks were made compulsory, in many swanky buildings the hired help and building staff wore masks but not the residents? The driver but not the owner in the back seat?

Many will go back to things we gave up in deference to modernity, more shoes will be left at the door, more concern on jhoota (sharing eating utensils). But even now we see that the outside drain or garbage pile continues to be ‘not my problem’, but my home must be disinfected for covid care.

Will the fear of going out make us live inside? We are already seeing social distancing being given the go-by whenever the lockdown is lifted even slightly; it’s not just the poor that were standing outside liquor stores; enough cars are visible on the road.

So no, don’t hold your breath expecting covid-19 to deliver a brand-new, evolved Consumer India. But Consumer India is in a rare state of pause and has time to listen, to reflect, to re-evaluate what fulfils their needs best—that is the opportunity, and the ‘watch-out’, for marketers.

Winners will be those who proactively market better. Losers will be those who wait for the consumer to emerge suo moto. So, investors are well-advised to track the supply side as carefully as the consumer side to determine likely outcomes.

Rama Bijapurkar is an independent market strategy consultant.