Industry News Research

McKinsey report reveals Australians embracing new values

McKinsey & Company has launched the second article in the online publishing series, The Story of the Australian Consumer – entitled ‘Emerging from COVID-19: Australians embrace their values’. The first report in the series showed that the economy is a concern for most Australians. Forty percent of all households are adjusting to a decline in household income, with Generation Z (born 1996–2012) and Millennials (born 1980–1995) the most affected and least confident of a recovery.

Research experts from McKinsey Design in Australia have followed 12 Australian families for a week to uncover the human and cultural context driving their observable changes. These families share their daily thoughts, fears, joys and behaviours through diaries, photos, videos and interviews.

The participants ranged from small regional families struggling to keep their livelihoods afloat; to couples in small inner-city apartments; as well as large families overwhelmed by the blending of work, home, and school demands under one roof.

“By combining ethnographic research that helps us observe human behaviour in real-life environments with our consumer-survey insights, a more vivid picture of Australian families emerges,” says Dr Rod Farmer, co-author of the article.

As Australia looks forward to getting back to normal, it is impossible to predict what changes will stick. The series shares McKinsey’s learnings from these uncertain times, to support the new breed of business leaders to make good choices about what future they are going to create for consumers.

The research discovered 5 clear insights that will influence consumer, shopper and buying behaviour:

1. Socially conscious values come to the fore: In the face of COVID-19, the Australian culture of doing the right thing, looking after your mates, and being all in this together has become more pronounced.

2. New dynamics at home mean new priorities: The worlds of family and work have blended into one, blurring the boundaries between responsibilities. More than ever, there is a demand for a more sustainable practice for Australian businesses, one that greatly improves work–life balance.

3. Developing healthy habits: The crisis is prompting people to take their health more seriously. Selfcare to prevent illness of all kinds has become a higher priority. Australians are learning more about what helps to keep us mentally healthy and positive.

4. More deliberate shopping choices: With the COVID-19 situation breaking many social and personal habits, consumers are now reevaluating priorities for how they spend time and money. Consumers are de-prioritising status symbols and focusing on setting up the home for entertainment and efficiency.

Restrictions are also changing the way people shop. Product availability, infection risk, fines, and limited childcare options make shopping a more challenging endeavour, requiring greater planning and thoughtfulness. We hear consumers talking about shifting to digital shopping. But, rather than a simple switch in consumer channel preference, they speak about mindfully evaluating and selecting digital retailers to avoid poor user experiences, slow and inaccurate delivery, reduced quality of customer service, and, at times, profiteering.

5. E-commerce’s failure to launch: Consumers have been forced to move offline purchases; activities and services, online. Australian consumers have experienced the failures of the online retail system and, as a result, many have lost faith in retailers’ ability to deliver on their needs.

Consumers are deliberately making choices in line with greater levels of digital consumerism, albeit while navigating a less than perfect digital marketplace. Australian consumers have experienced the failures of the online retail system and as a result have lost some faith in retailers’ ability to deliver on their needs.

A shining light is how quickly Australia’s small local businesses have creatively pivoted to provide quality local products.

“We see shifts in spending, changes in consumer preferences, forced and accelerated adoption of digital technologies, and rapidly increasing consumer expectations and adaptions of new household dynamics. The COVID-19 pandemic, is first and foremost a health crisis of immense proportion, but it has also had a profound economic impact upon consumers and global markets across almost all sectors”, says Dr Farmer.

“There is enormous impact to be had from designing better businesses from a consumer-centric perspective, and we think Australian companies are waking up to the value of design. We know that design-led organisations significantly outperform their peers in terms of revenue and total shareholder return. They do this because as a key driver of growth, design encourages us to think beyond our own frame of reference, empowers us to be more empathetic and to dive deeper into what matters most for others, and ultimately helps us deliver better products, services and experiences”, he concluded.

About the author

Shopping Centre News

Shopping Centre News (SCN) is in the ‘information business’, and is perceived as such by its readers. Daily industry news makes shoppingcentrenews.com.au a must-visit as part of the morning routine for those who want to keep right across the latest retail developments and events, while SCN's premium magazine is the leading publication for the shopping centre industry in Australia and New Zealand.

Known as the ‘industry bible’ SCN is printed five times a year with fascinating, in-depth features and important critical analysis written by known industry insiders as well as the popular ‘Guns’ reports, which ranks Australian shopping centre performances. Shopping Centre News is the only publication in the world that features centre statistics on Turnover, Turnover per square metre and Specialty Shop turnover per square metre for every major centre in Australia.

Add Comment

Click here to post a comment

Advertisement

Advertisement