Center view of small town Main Street with shops and restaurants.
As consumers emerge from the COVID-19 pandemic, many are looking away from big-box retailers and instead focusing their spending and support on smaller, local brands. — Getty Images/peeterv

Why it matters:

  • Against the backdrop of a pandemic-shaped year that kept folks close to home, 56% of consumers are now patronizing neighborhood stores or buying locally sourced products.
  • At-home food consumption and meal-delivery apps like DoorDash surged. Hence, startups to legacy brands are looking to monetize that demand with new at-home food service and delivery models that boost customer convenience and add a personalized twist to the dining experience.
  • The pandemic saw an uptick of consumers’ discovering — and purchasing — smaller brands via social commerce, particularly Instagram.

As our post-pandemic psyches start to emerge, one trend has crystallized: The big crisis has a number of U.S. consumers — bred on a steady diet of supersized stores and billion-dollar, boldface-named brands — thinking small.

Some consumers are ditching the mall for a modern-day bricks-meets-clicks version of Main Street shopping, voting with their dollars for local neighborhood stores, while buying up small new independent brands directly on Instagram.

At the same time, food merchants are crafting personalized at-home dining experiences to capitalize on the COVID-fueled delivery surge, and consumers’ heightened appetite for on-demand culinary experiences.

[See 9 lasting changes businesses can expect post-pandemic.]

‘Pivotal’ post-COVID shift: consumers to drift away from malls and boost shopping at local stores

One of the “pivotal” shifts in spending habits since COVID-19 is a drift toward local shopping and a move away from malls, with 75% of consumers planning to shop more locally over the next year, according to a study by digital operations platform Brightpearl.

While the shop-local/locavore movements have been bubbling for years, consumers’ sheltering-in-place lifestyles appear to have pushed the trend to a new apotheosis. Today, 56% of consumers are patronizing neighborhood stores or buying locally sourced products, according to Accenture’s findings on post-COVID purchasing behaviors that are poised to stick.

That shift reflects the crisis’ indelible, psychic imprint on consumers that’s still unfolding.

“The pandemic touched us all at a very human level and with that came a new appreciation for frontline workers and for our neighbors who were working in our local communities,” Jill Standish, global retail lead at Accenture, told CO—.

“This time has really made us all reexamine the value of our local communities. People want to support local stores, and we saw the most in-tune retailers respond by taking a responsible and ethical approach and tailoring their store with inventory and services that more closely aligned to what the community needs.”

What’s more, personalization became hyper-localized as consumers got to really know the store staff, from mom-and-pop shops to larger merchants, she said.

“Post the pandemic, more customers will likely continue this local patronage to support their local community — especially as many will continue to work from home.”

Indeed, although many offices are reopening, 86% of consumers plan to continue or increase working at home, Accenture found.

And despite pandemic restrictions lifting, the home will remain a central hub of work and social activity, so retailers are meeting consumers where they are.

One of the “pivotal” shifts in spending habits since COVID-19 is a drift toward local shopping and a move away from malls, with 75% of consumers planning to shop more locally over the next year.

Brightpearl study: "How We'll Shop"

At-home food consumption trend sparks new delivery, dining services

At the same time, more customers will seek meal solutions from local convenience stores, which will help sustain the shift to local shopping, Standish predicts. “Overall, staying close to your local downtown is definitely in-vogue and will likely stay for a while.”

While at-home food consumption and the meteoric rise in meal-delivery apps like DoorDash have leveled off from their pandemic peak, those sales will remain ahead of pre-pandemic levels, said Todd Hale, retail insights thought leader, during a webinar on consumer trends in food from The American Bakers Association, attended by CO—.

To that end, startups to big brands are flexing their creative muscles to meet that demand with new at-home food services and delivery models designed to boost customer convenience and add a bespoke twist to the dining experience.

“When it comes to innovation, we’ve never seen anything like what we’ve seen this year,” Hale said. Amazon, the nation’s biggest online retailer, is expanding its in-garage grocery delivery service from five to 5,000 U.S. cities, while startup Wonder will literally prepare a meal right outside your home, he noted.

Backed by Marc Lore, the serial e-commerce entrepreneur and the former CEO of Walmart.com, Wonder’s fleet of on-demand food trucks are now rolling into high-end New Jersey neighborhoods, its pilot market, targeting affluent consumers. Chefs from some of the country’s best restaurants, the startup touts, whip up personalized meals at diners’ doorsteps.

When restaurants are challenged to fill their seats, Hale told CO—, they’ll look to offer “a different twist on food delivery by taking the kitchen and a chef to the doorstep of households who can afford a just-in-time restaurant meal.”

[Read here on 5 restaurant industry pandemic pivots.]

The rise of Instagram shopping propels the discovery of smaller brands

While much has been said about the pandemic catapulting online shopping to new heights, consumers are also converting faster online: In other words, customers require fewer website interactions before clicking the “buy” button, according to a study on the psychology of the post-COVID consumer from digital agency EGC Group.

And they are increasingly purchasing from new brands, too, particularly as social commerce, most notably Instagram, has made in easier to do so, Nicole Penn, president of EGC Group, told CO—.

“We see many more customers who are willing to buy from new brands [directly] on Facebook and Instagram that they’d previously had no association with” — and not just millennials and Gen Z, but Gen X and Baby Boomers, too, she said.

“There’s more of a ‘see it, buy it, love it’ philosophy on Instagram, and brands have made it easier to purchase [on the site] — you can buy something in three clicks.”

As a result, “Social commerce, especially Instagram shopping, has made people more likely to buy based on product and less likely on brand,” Penn said. “They are happy to test a new brand, no matter the size, if they offer the product, features and style they are looking for.”

COVID-changed consumers are also seeking out products with a patina of authenticity and an artisan feel, according to Accenture findings. So, it comes as little surprise that Etsy, the online marketplace for small vendors and handcrafted goods, saw its business boom amid the pandemic.

"Last year the world took notice of Etsy's highly differentiated value proposition, and that incredible momentum has continued into the first quarter of 2021," said Etsy CEO Josh Silverman this month, in a press statement on the company’s first quarter results.

Psychologists say that it takes 66 days for a new behavior to become embedded, notes Andrew Busby, CEO of Retail Reflections and IBM futurist, in the Brightpearl report. “And of course, the coronavirus pandemic and associated measures have been with us for a lot longer than that. So, it appears reasonable to predict that many of our behaviors will not be reversed.”

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Published June 01, 2021