Pinoy consumers to adjust buying habits as low-key Christmas looms
Filipinos will likely have more intimate Christmas celebrations this year with consumption capped by lingering economic uncertainties as well as government restrictions on large group activities still in effect, according to an international market research firm.
In a statement, Nielsen Retail Intelligence managing director Patrick Cua said upcoming festivities were going to look very different for local consumers with people “resetting” their buying behavior, which, in turn, reinforces the “unprecedented state of flux” of the retail sector.
“With mobility and mass gathering restrictions still in effect, Filipino consumers will continue adapting to the homebody economy and will extend to how they celebrate Christmas during the pandemic,” he said. “With cooking being central to festivities, we predict a growth in baking and food category this year.”
The consumer study noted that, with Christmas celebrations being more intimate and smaller this year, food would be integral to this festive season. Nielsen predicts a rise in food categories such as ham, all-purpose cream, pasta and canned foods across budget and premium cooking categories.
While “constrained” shoppers are looking at a single consumption, “insulated” shoppers are indulging in gifting food and health products. As such, some brands are adjusting their offerings to cater to both constrained and insulated shoppers during Christmas.
Against this backdrop Nielsen has identified five different consumer groups that indicate how financial and physical restrictions could manifest leading up to the festive season.
The first is made up of “constrained and restricted” consumers who have suffered income losses as a result of COVID-19 pandemic, have less money to spend and also have less freedom to physically congregate and shop for their holiday needs due to local restrictions to travel, business openings and social interaction.
A second group is composed of “constrained but free” consumers who have also suffered income loss and are likely to have a savings mindset as they prepare for the festive season.
A third group is made up of “cautious middle” consumers who have not yet been impacted financially and their celebrations are not limited by local physical restrictions.
The fourth group includes “insulated but restricted” consumers who have not been financially impacted by COVID-19, but whose festivities will be impacted by local physical restrictions. Finally, there are “insulated and free” consumers who have also not been financially impacted by COVID-19.
With Christmas sales reaching P97 billion from 2017 to 2019, Nielsen expects a rise in fast-moving consumer goods sales in December 2020.
“Manufacturers would need to adopt different strategies to appeal to both the constrained and insulated shopper,” Cua said, pointing to the new consumer mindsets. “Packaging, promotions and bundled deals would be key to win the Christmas shopper. With a slowly stabilizing economy, we predict that discount value shopping will power holiday consumer behavior in 2020.”
