The consumer behavior post-COVID-19 has changed dramatically in China. I exchanged briefly over the topic of consumer behavior last year with Pr. Jeffrey Towson of Peking University. But there was no COVID-19 at that time…
Whether you conduct your business across borders or across the street, your company is affected by COVID-19. Movement restriction by governments combined with fundamental changes in the way people live/work resulted in the appearance of new businesses. And the disappearance of others. Of course, with big challenges come big opportunities. Those who spent their days during the crisis browsing through social media and sitting at pointless webinars have missed the train. Those who kept their fingers on the pulse of the consumer, devised action plans and acted swiftly, made good profits and consolidated their position in the Chinese market.
Which industries are having a good time in China in 2020?
Meditation and mental health
Lockdowns are not always an enjoyable experience. Painful experiences include dealing with an abusive husband or wife, being in the presence of kids for extended periods of time, or practicing physical distancing. These can take their toll on unsuspecting individuals not used to spending weeks or even months locked-in with relatives 24 hours a day. Finding balance beyond the daily occupations became a necessity as consumers went seeking relief in meditation and psychological counselling. The aftermath of the crisis will be as difficult, hence keeping the demand up for those services.
In times of crisis, everybody becomes an expert. Everyone with a decent phone and an internet connection creates content, releases it to the world, and goes looking for attention spans. This means knowledge and information get diluted. Hence relevant content becomes harder to identify. Companies that offer curated content to kids, college students, and professionals through novel engagement tools have a bright future ahead.
Laws and regulations govern personal and professional transactions and interactions. With COVID-19, individuals had to turn to legal experts to seek guidance in figuring out how to navigate the troubled waters; i.e. potential job loss, renegotiating a mortgage, insurance liabilities. The popularization of legal knowledge will produce a long-lasting effect.
Health and healthcare
This is one of the biggest beneficiaries. People finally came to realize that maintaining a healthy lifestyle improves one’s immunity. It’s no surprise that during and after the first wave of COVID-19 outbreak, products and services related to health garnered increased attention. Many opportunities presented themselves in different industries. Some examples include
- Bio and organic food: Consumers showed an increased interest in the origin of the food they feed their family. This was a combination of more time spent at the kitchen and concerns over what ends on our plates when we eat outside.
- Home sports equipment: Sports became an affordable hobby. This was made possible with gyms closing down, plenty of free time under lockdown, and free online workout classes. This translates into higher demand on sportswear, sports equipment and gear.
- Biomedical/pharma/chemicals: New regulations are forcing businesses to spend more in protecting employees and value chains. From antibacterial soaps to industrial disinfectants and sanitizers, companies have to live with this new mandatory expense.
- Hospitals and medical care: Governments all over the world came under heavy pressure to upgrade health care facilities (hardware) and improve patient services (education).
Mandatory home confinement meant more time spent in the living room and the kitchen. Families needed to
– Equip their kitchens with the right appliances,
– Set-up a work space at home, and
– Refurbish their living room to make their down time more enjoyable.
Companies that managed to quickly adjust their offer to fulfill those needs benefited greatly from these household upgrades.
Will these trends remain trends or will they become habits over time? Will consumers keep directing their spending power towards some of them? Are the new market players able to carve out a space in the arena? Does everything in life have a tech component now? What’s the role of governments in all of this? Regardless of how your business answers these questions, consider that:
- We are edging closer to a world where we won’t know whether we are living an online or offline experience. The merging of those two worlds is happening in shopping and entertainment, and will accelerate in education, travel, work and more. Companies that get this transformation right will have good years ahead.
- As the Chinese saying goes, “Clear water has no fish.” Business is moving faster than the bureaucrats that regulate it, which leaves room for entrepreneurial individuals to maneuver freely without many restrictions, especially in the fields of Artificial Intelligence (AI), robotics, and data. Another good chance for Chinese society to accelerate its digitization.
- Trust erodes when crisis occur. European governments stole each other’s PPE and mask stocks, manufacturers pocketed advance payments and disappeared, shoppers hoarded food at supermarkets. When we think “Trust”, we think moral and human ideals. When future generations will think “Trust”, they will think control, data and blockchain.