Photo: @Maria_Sbytova via Twenty20
How will COVID-19 shape future consumers?
A survey of Australian adults taken in the early months of the pandemic found 84 percent believing COVID-19 will play a significant role in shaping the current generation of children.
The survey was part of a study from Australia consultancy, McCrindle, exploring the pandemic’s impact on Generation Alpha (individuals born between 2010 and 2025). Many in the group are expected to remember the pandemic, with the oldest turning 11 this year.
“Many watched mum or dad work from the kitchen bench while keeping an eye on them as they learnt from a virtual classroom,” wrote McCrindle in a blog entry. “They might not know why we need to stay 1.5 meters away from other people, but they know that we should. The fact that there was a prolonged period of time where they couldn’t go to the park or visit grandparents is not lost on them.
Some trend watchers, in fact, are starting to call younger generations most impacted by the pandemic “Gen C” or “Generation COVID.”
In a widely-cited report that came out last December, Haim Israel, head of thematic investing for BofA Global Research, estimated Gen C being born from 2016 to the mid-2030s.
Mr. Israel wrote in the report, “This generation will feel the impact of COVID long after the pandemic ends in terms of how they trust and show intimacy — being trained not to hug, shake hands or even play in groups. Virtual attendance will be as accepted as in-person attendance for all activities, from classrooms, to talent shows, and even family reunions.”
A CNN report cited a mental health expert who believed children between the ages seven and nine are particularly vulnerable to the pandemic’s disruption, but some expressed more concern about development for toddlers.
Generation Alpha is expected to be a step further digitally-immersed than their predecessor generation, Gen-Z, and the McCrindle survey found nearly all adult respondents expecting that, as a result of the pandemic, technology and screens will become more integrated in children’s lives. While 65 percent felt the experience would have a negative impact on children’s mental health, 78 percent felt the pandemic would make children of today more resilient.
- 84% of adults believe COVID-19 will significantly shape Gen Alpha – McCrindle
- OK Zoomer: Gen Z Primer – BofA Securities
- Meet Gen C, the Covid generation – CNN
- Will Gen Z be the ‘most disruptive generation ever’ for retail and brand marketers? – Retailwire
- Has COVID-19 transformed Gen-Z forever? – Retailwire
- Half of Generation Alpha will rely solely on social media to get their news – Express
- Generation Alpha kids carry on trend of declining interest in sports – Axios
- What comes after Generation Z? Alpha, of course – The Sydney Morning Herald
- ‘Pre-Schoolers Using Tablet Or Mobile Can’t See The Forest For The Trees – Eötvös Loránd University Faculty of Science
Discussion Questions
DISCUSSION QUESTIONS: Is it practical for retailers or brands to start studying and preparing for how Generation Alpha may be impacted by the pandemic? In your opinion, how will growing up through the pandemic affect how Generation Alpha shops in adulthood?
Poll
Loading …BrainTrust
Bob Amster
Principal, Retail Technology Group
Neil Saunders
Managing Director, GlobalData
A couple of years ago when they became one-third of the global population retailers were looking at Gen Z to determine future habits. However COVID-19 has changed perspectives and approaches forever. Generation Alpha will not remember life before COVID-19 so the “low touch” approach is really all they have ever known. Who knows how things will evolve in terms of general life (e.g. if we will ever shake hands the same way) but it can only have an impact and retailers need to consider that this future generation of economic buyers will have only ever known the post-COVID-19 way of doing things.
Impressionable young children will certainly be affected by the pandemic, as will their shopping behaviors when they reach that age (which will be very soon for those born in 2010). Experiential retail is here to stay, but how those experiences are delivered will need to adapt and evolve to shifting customer behaviors. Retailers that cater to younger people should begin studying how the pandemic might change the behaviors of their target audiences, and begin planning for experiences that align with those new behaviors.
My eldest grandson just turned six, his brother just turned one. There have been significant changes in their young lives, so yes, I do think it will be advantageous for retailers to pay close attention to this generation.
My daughter worries about the baby because he wasn’t able to do all of the things his big brother did – like visiting friends, restaurants and stores – things that build social skills. The six year old is very aware of how his life was interrupted. He frequently asked about things we used to do before the “cold bug” hit. That being said, he bounced back quickly once we were free to move about without masks and social distancing.
Young kids are resilient, but I worry about how the older ones will be affected. Even in grown up places the in-store experience has to be a good one because kids are taking it all in.
Just as the Great Depression impacted our grandparents and parents, so too will this pandemic have a similar long-term effect. Gen “C” (which we all hope will be a very short generation) will be forever impacted in some way by this plague. Retailers should always be ahead of the curve on shopper psychology, and COVID-19 has had a dramatic impact on all ages. Since the ultimate goal of any retailer should be to understand each shopper as an individual, there’s no harm in hyperfocusing on this group for the future.
What is the store of the future based around customer convenience? Just Walk Out technology, drop-and-go returns, BOPIS and BOPAC, and MFCs (Micro-Fulfillment Centers) are all the new normal as this plays out. We’re also expecting more retailers to hire data scientists who can use AI and data analytics to cut to the chase on the immediate retail-related impact of COVID-19 on kids and adults as well.
Good points, Ken! It’s interesting that you should mention the Great Depression. Because of her experiences as a child, my mother-in-law didn’t spend a penny she didn’t have to spend. Conversely, my mother tended to over stock. You never know how children will be affected; we may not see the full effect of COVID-19 for many years.
The Great Depression lasted (more than) a decade, fundamentally impacting every level of society, the economy and government. The pandemic is a year-and-a-half (though admittedly it isn’t over yet).
I won’t say it’s an insult to our grandparents’ hardships to compare the two, but I think the difference in scale is crucial.
Brands need to invest in understanding the attitudes and behaviors of consumers across all groups, since many of the shopping trends have a long-lasting impact. But in most cases, the situation is largely reverting to pre-COVID-19, even in high touch situations like restaurants, events, etc.
Innovation in retail has leapfrogged by five to seven years in the past 12 months. While the resulting changes are significant, as this generation grows up the effects might taper off.
It is important for retailers to begin reading the professionally-issued studies. Most of these studies will be coming out over time, not tomorrow. Marketing departments of most retailers should be very busy reading and planning how to adjust to the newly-established norms and preferences. Plenty of work there…
Generation Covid? What a terrible term! No generation should be defined by something as negative as a pandemic – especially if the cohort stretches well beyond the next few years. As for the impact, yes, there will be some. However my view is that things such as human contact and interaction will eventually normalize, simply because most people want and need them. In that respect, the peculiar aspects of the pandemic, such as isolation, should not be seen as permanent shifts and as the new hallmarks of a generation. It’s far more pertinent to look at underlying trends the pandemic accelerated such as working patterns, digital and so forth. Those things will have a much more significant impact longer term.
We are going to have a generation of adults who will carry the memories of missed graduations and canceled trips. Anyone who wants to relate to that group needs to understand the impact COVID-19 is having on their lives today.
Not only Gen A, but ALL of us. We just did two studies on this topic and the thing that stuck out the most was the renewed interest in shopping local. Local brands OR mega brands that get into neighborhoods fared really well in terms of “where will you shop the most going forward?” Work from home was/is a huge factor in that result as parents and kids (Gen A) are spending a lot more time in their own vicinities and asking for more. Let’s face it, retail was already getting blown into smaller parts and the pandemic sped that process up. Local makes a lot of sense going forward.
But if the question is only about Gen A, I’d say look to livestreaming. Projected to be turning at a $23 billion rate in a year or so, the idea of a TikTok way of buying seems to be natural for generations to come. You know, shoppertainment.
Retailers should study all majors trends including the impact of the pandemic on consumers. While I agree with Mr. Israel on many of his conclusions on the impact of the pandemic, I think consumers will return to old habits fairly quickly with some exceptions like buying online and BOPIS. Generation Alpha will behave differently in terms of using their cell phones for purchases and many of the conveniences of delivery and pick up already available in stores. But consumers will still shop in person as they do today.
Sorry, but I don’t buy any of this: how many of us have any but trace memories of our childhood? (The ones most likely to be affected are recent HS or college grads who had their senior years and transition into adulthood interrupted, but this is a relatively small group).
There’s a major caveat to my opinion, of course: life has to return to “normal” soon; if we have a resurgence — not just a Delta, but a Gamma, Rho … all the way down to Omega — the impact will grow, on everyone exponentially.
The impact of the pandemic on our shopping habits, work habits, and other lifestyle habits isn’t over yet. Some early habits are already fading, while others are just settling into the mainstream. Will Gen Alpha reflect new habits that retailers should prepare for? Absolutely, it’s less clear how much of that will be attributed to the pandemic as much as each new generation establishes different habits – especially around all things digital. As much as we’ve talked about Gen Z being so much more digital-centric than Millennials, Gen Alpha had even more digital experiences thrown at them during the pandemic. And this was at an age where such habits become permanent more easily. Retailers will want to watch for every new study that is released on this topic to be prepared for when this generation starts expressing their consumerism!
Memory of pandemic and “the year lost” will be part of history and shape those who grew up and remember it. Increased use of delivery being more acceptable and lack of in person interaction experiences will shape how the future generation work and shop. However, keep in mind different people will react differently in the long run, some may turn into hermits while others will aggressively seek out in person experiences to compensate for the lost time.
No one truly knows how growing up during covid will affect Gen Alpha’s shopping habits but if we look to past periods of upheaval, we see that these kinds of events typically lead to one of two things: either a resurgence to prior times or a rush of innovation. Think of the roaring ’20s vs. how companies responded to gas/oil shortages in the ’80s with brand new solutions.
Looking ahead, I think that the retail experience of the future will become not just micro targeted, but also micro experiential. Ease and convenience are on a collision course and for retailers, this means reducing the time gap from buying to delivery. Shoppers should be able to view an ad for a product that’s tailored to them and then receive that same product within a matter of hours, not days or weeks. To accomplish this, retailers should pay attention to what the data is saying. Look to individual insights from things like consumer loyalty card data to better understand new and emerging trends and don’t be afraid to explore new distribution channels to get your products into the hands (and bellies) of consumers faster.