Subject: Consumer Behavior If have reference, include reference. No limit pages.
CASE STUDY 1 (10 MARKS) 5 WAYS COVID-19 HAS RESHAPED CONSUMER BEHAVIOR With COVID-19 case counts declining and vaccination efforts underway, eager consumers and retailers are both looking hopefully toward a future return to normal. And while the timeframe is still fuzzy, one thing is clear — the “normal” that we’ll find ourselves in post-pandemic will be familiar, but also fundamentally different, from the world we knew before COVID-19. The pandemic has forever altered consumer behavior, and this year in particular consumers find themselves in a kind of limbo — hope is on the horizon, but “normal” isn’t here yet. For that reason, market research provider Euromonitor International has identified resilience and adaptability as the two driving forces of consumer behavior in the coming months in its recent report, Top 10 Global Consumer Trends 2021. The study draws on the expertise of its team of global analysts covering 100 countries around the world to identify the traits that will define consumer behavior this year. Here are five key takeaways: The 2021 Consumer is Craving Convenience 2020 put a new spin on the old adage, “You don’t know what you have until it’s gone.” Moving into 2021, consumers are looking to get back what they lost, seeking out the ease of daily life that they previously took for granted, but with a newfound appreciation. For that reason, a seamless, streamlined customer experience will be front and center. As consumers continue to rely on digital channels for services that still cannot take place (or that they don’t yet feel comfortable doing) in person, a positive experience across all channels will play a pivotal role in purchasing decisions and loyalty. “The goal is to offset COVID-related inconveniences and recapture an experience that feels normal,” according to the Euromonitor study, but one size does not fit all. Businesses must also account for generational preferences. For example, Euromonitor found that younger consumers are likely to prefer digital interactions, while their older counterparts prefer talking to human customer service representatives. Retailers that work to create streamlined omnichannel experiences now will have a leg up in the post-pandemic world, particularly since the re-growth of physical retail is likely to be a slow process. “Consumers will revert back to certain pre-COVID-19 behaviors like visiting physical stores or attending in-person events, but their new habits will impact the frequency of such occasions,” said Alison Angus, Head of Lifestyles at Euromonitor International in an interview with Retail TouchPoints. For the 2021 Consumer, Physical and Virtual are Inseparable Digital tools saved the day last year, making it possible for much of life to continue despite the physical restrictions imposed by the pandemic. As a result, even older consumers have become acclimated to digital interactions, and consumers now expect integrated experiences. “A blend of virtual and in-person occasions has been building, especially with younger consumers,” said Angus. “Teens today do not differentiate between digital and physical — it just is. Now, consumers of all ages experienced the virtual world more closely and have seen the benefits.” Blended solutions — that is, virtual activations in physical spaces or virtually enabled at-home experiences — will feel natural to consumers and drive sales. “Integrating virtual tools into operations speaks to the consumer’s desire for greater convenience as well as the blending of the physical and online worlds,” said Michelle Evans, Senior Head of Digital Consumer at Euromonitor International in an interview with Retail TouchPoints. “Shopping used to be largely reserved for physical outlets, with ecommerce serving more of a transactional role in the consumer’s shopping journey. In a digital-first era, retailers will be challenged to increasingly replicate the unique elements of the in-person experience into the online shopping experience.” Values Matter More than Ever to the 2021 Consumer Consumers already were becoming increasingly values-conscious prior to 2020, but the events of the past year increased the urgency and momentum of this trend. “The pandemic made consumers take a step back, think about how we are living and realize we can do better,” said Angus. “The acceleration of social and environmental concerns, protecting the health and interest of society and the planet, is the new expectation.” In 2020, Euromonitor found that 73% of professionals believe sustainability efforts are critical to success. Interestingly, environmental initiatives in particular were waylaid in 2020 as companies and consumers rapidly changed their behavior in response to the unique circumstances created by COVID-19: 51% of professionals reported increased use of plastic packaging, and respondents also noted delays in recycling, waste reduction and green technology efforts. For consumers the post-pandemic world represents a second chance, an opportunity to rebuild better, and they’ll be putting their money behind companies that offer a purpose-driven proposition, whether it be social, environmental or both. The 2021 Consumer has a Recessionary Mindset This year “value” also will take on another meaning, as consumers decrease their discretionary spending in response to continued economic uncertainty. “Consumers are thinking carefully about their purchases and the money they spend,” said Angus. “Some are indulging in affordable luxuries to provide comfort, but most consumers want value for money. Value is not just defined by price, but also the benefits to the consumer — does the product solve a problem, or what health and ethical attributes does the product have?” Pessimism is higher among millennials and Gen Z due to the 2008 financial crisis, the Euromonitor study finds, but consumers across the board are prioritizing value-added and health-conscious products and services as they economize their spending. As a result, Euromonitor expects shoppers to shift dollars to private label brands and off-price retailers, as well as seek out options like buy now, pay later and subscription services, both of which also tie into consumers’ desire for convenience. “Companies should pivot toward value-for-money propositions, offering affordable options without sacrificing quality,” Euromonitor advised in the report. “Premium attributes should be reinforced with a new empathetic story and have a strong tie-in with health and wellness, self-care or mental well-being.” To the 2021 Consumer, Wellness Means Safety For several years, wellness has been gaining consumer mindshare, but in 2021 “wellness” will have a different meaning, focused more on tactical safety than general well-being.   With new behaviors like mask wearing and regular hand washing now ingrained as everyday habits, the 2021 consumer has developed an almost instinctual awareness of hygiene and cleanliness. As a result, contactless and unattended commerce solutions will continue to gain prominence, and much like other technologies introduced during the pandemic, these solutions will likely be here to stay. Additionally, companies that make a clear, substantive commitment to customer and employee safety also have an opportunity to differentiate themselves among values-conscious consumers. Source: https://retailtouchpoints.com/features/trend-watch/5-ways-covid-19-has-reshaped-consumer-behavior QUESTION: Explain the lesson that you can learn from this case and whether they can be related with consumer behaviour in Malaysia.
Subject: Consumer Behavior If have reference, include reference. No limit pages.
CASE STUDY 1 (10 MARKS) FIVE CONSUMBER BEHAVIOR TRENDS TO WATCH IN 2021 The consumer that you must market your business to in 2021 is not the same consumer you targeted a decade ago — they’re not even the same consumer you appealed to just a year ago.  In-location experiences have changed in many ways during the past year, from the sanitary expectations to the sheer number of people you can expect to visit your business. Those who offer in-location experiences must reassess their approach in virtually every way. They must begin by reevaluating what matters most to the 2021 consumer and molding their in-location experience around newfound concerns as well as age-old desires. To help with this, we have published our State of Consumer Behavior 2021 report. The report is a barometer for where consumers stand on in-location versus online experiences during the thick of Covid-19 and how their outlooks could change given time and relevant developments like the successful roll-out of a vaccine. Through our data, several trends emerged that can inform actions taken by in-location experience providers in 2021. Trend No. 1: Covid-19 remains a factor that physical businesses must account for If our findings are any indication, consumers remain cautious. In 2020, 40.3% of respondents visited physical locations significantly less frequently because of Covid-19. Another 27.8% of respondents reduced their in-location visits to a minor degree due to health concerns. There is reason to believe that such trends will extend into 2021 as 27.9% of respondents said a successful vaccine would not necessarily increase the number of visits they make to physical businesses.  Fortunately, offline businesses across the nation have gone digital, offered curbside pickup, re-organized their stores and taken other unprecedented measures to accommodate governments’ and consumers’ demands. Those who manage experiences may plan to continue those measures.  Action: Physical businesses that want to make the most of 2021 will be able to offer the unique benefits of in-location experiences within a greater framework of safety. Engage with your customers to get their direct feedback on how you are doing and where you can improve.  Trend No. 2: Customers will tire of digital shopping’s shortcomings Give somebody too much of something good and, eventually, they will tire of it. This principle applies to virtual experiences.  Shopping online or having a Zoom coffee chat has its benefits, namely convenience and safety. These alternatives will serve as a substitute for in-location shopping or a physical coffeehouse — for a time. Our data reveals that online experiences are not permanent substitutes for in-person experiences as 46% of respondents said they still prefer to shop in person rather than online. Those who prefer in-location experiences cite the ability to hold and directly view products and the unique experience that a physical business provides. We also found that even those who prefer online shopping do not necessarily prefer online shopping (or other online experiences) all of the time.  Consumers have had more than their fair share of online shopping, have gone without in-location entertainment for far too long and are generally anxious to get back to some kind of normalcy. Action: By emphasizing the best of what in-location experiences offer (direct interaction with products, the personality of a business and friendly customer service agents, etc.), offline businesses can attract attention and be primed to safely serve experience-starved customers in 2021. Trend No. 3: Brand loyalty will make or break offline businesses Building goodwill with the customer has always been key to a businesses’ success. In turbulent times for physical businesses, brand loyalty could truly make or break an offline business. Since the pandemic began, 48.7% of respondents said they replaced products that they purchased regularly at physical stores with competitors’ online alternatives. More than a quarter of respondents said they switch brands more often today than ever before. A customer may be far more likely to abandon a physical business with no online presence for an online substitute if they feel no loyalty toward the physical business. Action: It is never too late to build loyalty. With each customer that walks through the door, you have an opportunity to convince them that the experience you offer is one worth returning for. With each visit, positive interaction and memorable experience, you build loyalty.  Digital signage is one way to enliven your physical space, steer customers to deals, communicate that you are implementing safety protocols, provide self-checkout and maximize the customer experience in a way that fosters feelings of loyalty. Trend No. 4: Convenience will remain key Covid-19 has nudged offline businesses into offering more convenience than ever before. Curbside pickup and dropoff is now the norm for businesses that may have never before considered such services. In fact, 25.5% of respondents listed convenience as the deciding factor in where they choose to give their business. Do you really expect that consumers are going to want to cede the option of curbside pickup, drop-off and other uber-convenient aspects of offline businesses once the health climate cools down? Action: While you may have implemented some processes as a result of the pandemic, now is the time to figure out how to maintain them in a long-term, post-pandemic way. What can you do to stand out now that these services are the norm? How can you further provide value and make it easy for customers to choose you? Trend No. 5: In-location experiences are a deal-breaker Customers who choose an offline business rather than settling for an online one desire one thing over all else: a worthwhile — preferably phenomenal — experience. When asked, 90% of respondents said that they would be likely to return to a business where they had a positive in-location experience. Action: Many businesses think about their investments into experiences as a nice to have, but in 2021, forward-thinking businesses should view experiences as a unique way to drive revenue.  By combining convenience, safety, a lively atmosphere, efficiency and great customer service, those who design customer experiences can continue to differentiate themselves and achieve success regardless of the broader social climate. Source: https://www.forbes.com/sites/forbesbusinessdevelopmentcouncil/2021/02/10/five-consumer-behavior-trends-to-watch-in-2021/?sh=57834e3c3899 QUESTION: Discuss on whether the above consumer trends are relevant or related with the Malaysian consumers based on your experience and observation.
Subject: Consumer Behavior If have reference, include reference. No limit pages.
CASE STUDY 1 (10 MARKS) HOW EXPOSURE TO NEGATIVE FEEDBACK IN ONE DOMAIN INFLUENCES GOAL-DIRECTED CONSUMER BEHAVIOURS Threats to self-esteem and negative feedback are pervasive in today’s society. Social media researchers, for example, have shown a link between frequent usage of social media websites and upward social comparison and negative affect. How does this influence consumer behaviour? A new paper published in the Journal of the Association for Consumer Research examines how single and repeated exposure to negative feedback in one domain influences goal-directed consumer behaviours. In “The Motivating And Demotivating Effects Of Negative Feedback On Cross-Domain Goal Pursuit Behaviours,” authors Alison Jing Xu, Shirley Y. Y. Cheng, and Tiffany Barnett White hypothesize that receiving negative feedback induces a general motive to boost one’s self-view, which motivates people to pursue proving goals (i.e., those that allow them to demonstrate their competence), even in areas that are unrelated to the feedback. The authors propose that negative feedback also demotivates the pursuit of enjoyment goals (i.e., those that focus on the pursuit of pleasure and therefore have no self-restorative characteristics). These motivational consequences not only influence consumers’ goal pursuit behaviours when a single goal (either a proving goal [“Playing this game can prove my intellectual abilities”] or an enjoyment goal [“I would have a lot of fun playing this game”] is activated, but also affect consumers’ choice between a proving goal and an enjoyment goal. Although receiving negative feedback may give rise to negative affect, the motivational consequences of negative feedback on goal pursuit behaviours were not driven by negative affect, per se. Instead, the motivation to boost one’s self-view mediates the motivational influence of negative feedback on goal pursuit behaviours in other unrelated domains. The authors conducted four experiments to support their hypothesis: manipulating negative feedback by providing performance feedback on a creativity test or an emotional intelligence test, and demonstrating its influence on consumers’ motivation to pursue either a proving or an enjoyment goal, as well as on consumers’ choice between a proving goal and an enjoyment goal. “We showed that receiving negative feedback in an unrelated domain motivated consumers to spend more effort searching for product information if their search behaviour was driven by the goal to identify the best option and prove their ability to make wise decisions (i.e., a proving goal),” the authors write. However, when consumers’ search behaviour was driven by the goal of having fun (i.e., an enjoyment goal), receiving negative feedback reduced search efforts. Study participants who received negative performance feedback on a creativity task in one study responded by searching for information about options in an ostensibly unrelated study when this search behaviour was framed as a proving goal. Similarly, receiving negative feedback on an emotional intelligence quiz increased participants’ later likelihood of choosing to play a game that could demonstrate and improve their intellectual abilities (Clash of Clans) versus one they would enjoy more and have more fun playing (Fruit Ninja). The findings also suggest that while consumers may be eager to self-improve when they receive initial negative feedback, repeated negative feedback exposure may undermine their confidence in their ability to self-repair, resulting in their being less motivated to pursue proving goals. This finding has important implications not only for the dynamic effects of self-repair motives on consumer behaviour, but also for how to give negative feedback. “Specifically, it suggests that although people generally strive to self-improve after negative feedback, too much negative feedback can lead them to seek enjoyment rather than self-improvement, even in areas that have nothing to do with what they failed on previously,” the authors write. The findings may offer a path through which firms can have a positive impact on consumers’ well-being. The findings suggest that, independent of potential effects of mood, receiving feedback that causes consumers to experience a threat to their self-concept (e.g., unflattering social comparison on a social media website) can influence not only their preferences for a given brand, but also the depth of their engagement with that brand. For example, the consumers in the first experiment were not only interested in trying the items in the assortment following negative (versus positive) feedback, they also literally searched more options for a longer period of time. The drop of self-esteem as a result of upward social comparison may facilitate the marketing of goods, services, and activities that are associated with proving (but not enjoyment) goals (e.g., via Facebook ads) in the short run but not in the long run. Source: https://phys.org/news/2020-05-exposure-negative-feedback-goal-directed-consumer.html QUESTION: Discuss the motivational issues stated in this article.