►►► Subscribe free: [ Ссылка ]
London
Three days a week at 7:00 a.m., senior Proctor & Gamble executives check in with each other about their customers: what they're buying, how their needs are changing and whether the company's products are hitting the mark.
"We need to stay very close to consumers and their habits, needs and desires, more now than ever," the company's chief financial officer, Jon Moeller, said during an earnings call last month.
Proctor & Gamble (PG), which owns brands including Tide, Fairy, Pantene and Gillette, is just one of the consumer goods giants that expects new habits formed during the coronavirus pandemic to permanently change the way consumers shop.
The early evidence suggests the shift to online buying is accelerating, consumers are buying more products for their health and home, and they are becoming increasingly cost conscious while choosing to save more.
On a call with analysts last month, Nestlé (NSRGY) CEO Mark Schneider said the company is "working overtime" to understand what the economic crisis means for each of its product categories. Nestlé is the world's largest food and drinks company, making everything from breakfast cereals such as Cheerios, to Maggi instant noodles, Häagen-Dazs ice cream, Nescafé coffee and San Pellegrino water.
"To me that is super interesting work because clearly this is not going to be a quick recovery," Schneider said. "This is going to be a several quarter, if not several year kind of process, where it is safe to expect some changed category dynamics."
In an environment where nearly everything changed overnight, consumer goods companies need to figure out which new buying patterns are temporary, likely to end along with lockdowns or the arrival of a vaccine, and which will linger, reshaping the way consumers spend their money for years to come.
"We're assessing market by market whether we need to make changes to our core products, prices and pack sizes," said Hanneke Faber, president of foods and refreshment at Unilever (UL), which makes Lipton tea, Dove soap, Hellmann's mayonnaise and Ben & Jerry's ice cream.
There's no "playbook" for this recession, she told CNN Business. "It will require us to be extremely agile and flexible for the foreseeable future."
E-everything
While a lot is still unknown, it's clear that some lifestyle changes and shifts in spending patterns are going to outlast social distancing measures. For example, some consumers opted to shop online because physical shops were closed or to avoid crowds, and now that they have made the leap, it's unlikely that they will revert to their old ways entirely.
"Early lessons from China suggest that three to six percentage points of online market share will be "sticky," driven by older generations newly comfortable with digital channels and by new consumer segments," partners at consulting firm McKinsey wrote in a research paper.
Their research found that the three largest UK grocers added more than 500,000 new delivery slots in the space of a few weeks, an increase of more than 30%.
Nestle's e-commerce sales globally shot up 30% in the first three months of the year, while Proctor & Gamble reported 35% growth in online sales over the same period.
The coronavirus crisis is likely to be a "breakthrough event" for online sales of food and beverages, as people who previously would not have bought groceries online discover how convenient it is, said Schneider, Nestle's CEO.
E-commerce is unlikely stay at the very high level it is at now, but "we've reached a higher plateau to grow from," said Jack Neele, a portfolio manager at Dutch financial services firm Robeco.
Health and hygiene
As with online shopping, health and wellness was a growing lifestyle trend well before the coronavirus hit, and it has only gained momentum during the pandemic. Consumers are wiping surfaces and washing their hands more than ever before, while sales of orange juice, considered beneficial to health because it's high in vitamin C, have soared.
"We're pretty confident that anything in the space of health and wellbeing is going to enjoy sustained strength," Unilever CEO Alan Jope told analysts last month.
Unilever has seen higher sales of products such as Lipton Immune Support, as well as drinks that contain zinc and vitamin C, said Faber. The company is moving quickly to roll these out around the world, and health will remain a priority for product innovation, she added.
"We will serve what will likely become a forever altered health, hygiene and cleaning focus," said Proctor & Gamble's Moeller, noting that US consumers are washing their clothes more frequently, adding up to more laundry loads per month.
Nesting at home
Even when lockdowns are lifted and restaurants, bars and cinemas reopen, there's a sense that people won't be in a hurry to go out again.
"There may be an increased focus on home: more ti
Click Subscribe to receive the latest news free
