Developing leading business strategies in a changing market

Understanding recent changes in consumer behaviour is essential in building good strategic management to overcome downturn and increase sales during and post the COVID pandemic.

For New Zealand companies, our strategic direction for the next six months is likely to look very different to the rest of the world. To some degree, our domestic market and those that operate only within the domestic market may feel the impact less. However, the impacts felt by importers, and in particular exporters and tourist operations, are likely to have flow-on effects to all industries.

With some estimating that it will take up to two years to recover to pre-COVID levels, and others even less optimistic, businesses will need to learn to adapt to the disruptive change with good strategy. Many businesses have already quickly identified and implemented new models of working, but even the most successful businesses may need to look at closures and lay-offs.

Utilising the current trends in consumer behaviour for diversification

The impacts  of COVID to date have changed the mindset of our consumers with the most prevalent trends being:

•     A shift towards DIY including home baking, crafts and self-sufficiency.
•     A new focus on physical wellbeing including fitness programmes, memes, life changes, and spending more quality time with family.
•     More people working from home or requesting more flexible work arrangements.
•     More people embracing new technologies, entertainment, and online ordering.
•     Some becoming more reclusive and happy with their own company, or that of their ‘bubble’.

See also my COVID-19 predictions for further insights.

It is important to start developing a deep understanding of the needs of your “new” customer to ensure that your product or service does not become irrelevant or is substituted by a more appropriate product that more accurately fits the “new need.”

It could be that for some businesses, their customers have become more focused on making their home more comfortable, developing new spaces, and building sustainably. This segment of people now feel empowered to purchase equipment, ingredients, and parts versus products.

For other segments, it could be that their customers have found a new sense of freedom after “lockdown,” are exploring new possibilities, and living life on a grander scale. Or for other businesses, their customer base could be grown by targeting those who previously spent internationally are now unable to do so – this new customer base could result in a growth in sales.

It is also important that we remain cognisant that, while our borders are closed, we are effectively in a transitional phase as well as a holding one, so the future from here on is likely to be different to the current new norm.  Be ready to read the signs and adapt.