Related Expertise: Emerging Markets

Edition 3: Who Is the Emerging-Market Consumer in the Postpandemic Era?

By Aparna BharadwajKanika SanghiPatrick WitschiNivedita Balaji, and Cinthia Chen

Nine months into the COVID-19 pandemic, and six months since our initial consumer sentiment survey in emerging markets, consumers’ behavioral patterns are starting to take shape. People are adapting, and while the dust is yet to settle, we already see early signals of a new reality.

The following trends give every indication of being permanent shifts, with significant implications for companies:

  • Consumers’ concerns are declining, even as the pandemic worsens in some markets.
  • Self-cocooning at home continues, months after reopening.
  • Some winning categories sustain growth, while others have had more temporary spurts.
  • The importance of communal camaraderie and trust is strengthening.
  • Digital usage continues to surge, and the number of first-time users is rising.

While deep concerns about COVID-19 persist, the prevailing attitudes are shifting from fear to acceptance. For example, consumer sentiment is linked more closely to death rates than it is to infection rates, as people become relatively less sensitive to the latter. If the new reality had a mantra, it might be, “Keep calm and carry on.”

As more time passes and the pandemic persists, it is becoming clear that consumers’ activities are taking a starkly different shape than those before COVID-19. A cocooning trend has emerged with people spending much more time at home. This is helping drive growth in such categories as fresh food, household care products, and direct-to-home TV. Even in China, which has the longest postpandemic experience, cocooning continues despite the newly reopened economy. Take restaurant dining, for example. At the time of our most recent survey, restaurants in China were open at 90% or greater capacity, yet demand was only 60% to 70% of prepandemic levels.

In our last two barometers, we discussed winning and losing categories. Now, with six months of data, we have a clearer picture of which winners will “stick” and which categories will rebound sooner. New consumer priorities, such as health supplements, fresh foods, and video subscription services, are seeing sustained acceleration. In other sectors, such as automotive, home construction, and alcohol, sales are recovering after some short-term postponement of purchasing. But the rapid spike in demand for categories such as personal care and sports equipment—a result of consumers’ initial reaction to the onset of the pandemic—is turning out to be temporary. For hard-hit sectors such as travel, restaurant dining, public transport, and others, the recovery is likely to be a long, drawn-out affair.

About the Barometer

BCG’s COVID-19 Consumer Sentiment Barometer series is based on the data drawn from an online survey of more than 40,000 consumers that has been conducted regularly since March 2020 in over 20 countries worldwide. The survey seeks to understand the pandemic’s effects on spending intent, attitudes, and daily routines and covers approximately 50 categories in financial services, consumer products, durable goods, entertainment, retail, telecommunications, and travel; the authors are members of BCG’s Center for Customer Insight (CCI). With this series, the goal is to give our clients and businesses around the world periodic barometer readings of COVID-19-related consumer sentiment and actual as well as anticipated consumer behavior and spending in order to inform critical crisis triage activities, rebound planning, and decision making.

The world is going through a shared experience that is shaping consumer attitudes, as well as their buying patterns. Emerging-market consumers show a heightened sense of family and communal camaraderie, a desire to buy local, and stronger trust in government and other important institutions. Health and wellness have emerged as priorities for many consumers, although in a majority of markets these manifest more in demand for products than in a sustained commitment to exercise and fitness activities.

It’s not news that COVID-19 accelerated digital behavior in emerging markets by up to five years. What’s more interesting is that new users are engaging in digital activities and are overcoming barriers by trying out digital transactions and forming habits that are likely to stick. For instance, digital commerce and interactions are gaining: the number of e-learners increased by 37% in India and the number of people using e-payments grew by 24% in the Philippines.

Companies need to keep these themes in mind as they determine how to cater to consumers in the new reality.

You can explore our findings in more detail in the slideshow below.