PremiumNEW DELHI: The ongoing covid-19 pandemic has changed the consumption habits of urban India with Gen Z and millennials preferring a conscious and contactless shopping experience, said a report from data sciences division of Dentsu India.
Titled ‘The Next Normal: The Rise of the Contactless Economy', the study has a small sample of more than 500 people, but spread across Gen Z (aged 5-25 years) and millennials (aged 25-39 years) in five metros and urban cities. 60% of the sample comprises Gen Z population.
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Premium Premium As per the findings, 70% consumers have expressed a willingness to purchase products from a lesser-known brand with a preference for local brands over international ones in categories such as fast-moving consumer goods, personal and home care, health products and apparel, among others.
“Millennials and Gen Z audiences lean towards local, socially and environmentally sustainable choices and are mindful of what brands stand for as well. There is also a heightened preference for products that use organic and ayurvedic ingredients as opposed to those that have high chemicals in the personal care category," said Abhinay Bhasin, vice president (Asia Pacific) and head of Dentsu Marketing Cloud (DMC) Insights, Dentsu International.
Covid-19 has seen a dramatic focus on health and is seen in an increase in expense on sanitization and immunization products by consumers. 84% of millennials and 75% of Gen Z surveyed stated that they constantly worry for their personal health.
Majority of them (49%) said they rely on Ayurveda to meet their immunity needs in the current times. Around 60% respondents turned to immunity boosters with a drastic rise in the demand and preference for Ayurvedic treatments. This split is more or less equal amongst millennials and Gen Z. The preferred brands include Dabur Chyawanprash, Revital, Patanjali and Himalaya Vitamins.
Owing to restrictions and lockdowns, online economy has taken off in a big way even in traditional categories like banking. The report highlighted that close to 60% of transactions of surveyed consumers claim to be fulfilled via virtual wallets, 23% via credit and debit cards and the remaining through cash. Digital payment platform Google Pay enjoys a lion’s share of online payments followed by Paytm.
Online shopping, already popular among the digital natives, has further expanded its base. The study reveals that Gen Z have increased their online shopping base 2.5 times to 30% from 12%, while millennials have doubled it to 32% from 16% during the lockdown with companies expanding their online footprint.
Groceries and snacks have seen a rise in online fulfilment by more than 3 times of base. While food-delivery is still largely online, there has been a recent shift and a continuation of food service consumption offline due to the rise of home-cooks. The fashion ‘apparel and footwear’ along with jewellery is still largely offline. Make-up and personal care products saw a rise of 40% in its online fulfilment, prompting people to discover new portals and brands online in this space.
“Online beauty is growing at 40% yoy. This growth is being driven by young Indians discovering beauty online and wanting products made more specifically for them. Which is why their preference is coming in for brands they feel are more connected to them and understand them better -- and this is where direct-to-consumer (D2C) brands have an edge over legacy brands," said Darpan Sanghvi, founder & CEO of beauty and personal care D2C startup MyGlamm.
Online education has been another category adopted by young consumers which has helped play a key role in skill enhancement and completion of curriculum while schools and educational institutions have remained shut. This has also resulted in a commensurate rise in ancillary purchases such as electronic devices. Around 59% respondents claim to have done an online certification in the past few months. This trend is likely to continue post lockdown.
Consumption of medicines has largely remained offline for this audience with purchases still being focused with local 24x7 medical stores. Personal doctors will remain the first point of contact and most trusted as well. 63% of millennials and 73% of Gen Z surveyed stated they would consult their own doctors first, even if it means online or tele consulting.
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