WHAT IS THE IMPACT OF COVID-19 ON CONSUMER BEHAVIOR IN THE MENA REGION?
COVID-19 is reshaping consumer values, habits, and spending behaviors at an unforeseen speed. The EY Future Consumer Index on MENA consumer behavior shows that people are cautious about the changing market trends emerging because of the COVID-19 pandemic.
- 34% Save and stockpile: Pessimistic about the future and worrisome about their families but are not worried about the pandemic
- 31% Hibernate and spend: Optimistic about the future as they are dealing with it properly and are the most concerned about the pandemic.
- 31% Cut deep: Pessimistic about the future and are the hardest ones hit by the pandemic. They tend to spend less on luxuries and focus on household productsand home hygiene.
- 4% Stay calm and carry on: Not directly affected by the pandemic and continue living and spending normally. Their only concern would be that others are stockpiling.
- 33% Stay frugal: Cautious with spending as they are pessimistic about the future.
- 23% Back with a bang: Mainly young workers are optimistic about the return to normal and are willing to pay a premium for high-end quality products.
- 21% Keep cutting: The least educated and likely not working, are deeply cutting on expenditure, and changing their buying behavior.
- 14% Cautiously extravagant: Health-focused but slightly optimistic will take time to go back to their normal daily activities and will tend to support local brands
- 8% Get to normal: Least affected by the pandemic and will make no changes to their lifestyles.
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1-Increase in E-Commerce
Companies should enhance their direct-to consumers capabilities and optimize their distribution.
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2-Optimize Supply Chain Cost
Companies should reassess their inventory based on demand fluctuation and supply chain constraints. They should develop the required capabilities to ensure resilience an optimized cost.
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3-Make Trade Spends Smarter
Consumers will become more price sensitive, so companies must continue to leverage price & promotion to drive demand.
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4-Improve Consumer Understanding and Create Innovative Engagement Platforms
To better understand the shifts in consumer expectations, companies should use the right tools to listen and develop innovative loyalty programs.
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5-Build Robust Risk Assessment Capabilities
Organizations must develop to carrying out continuous control monitoring and to identify revenue leakages, excess payouts, and cost optimization opportunities
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6-Reimagine Employee Management Practices
Companies should restructure their existing organization and manpower levels, and align with global practices, and to look for automation opportunities.