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Among the many consumer behavior changes that have happened in the last year since the beginning of the pandemic, the advent and growth of the ‘at home’ economy has possibly been one of the biggest changes impacting consumption trends in the gen Z and millennial audiences in urban India.

As per findings of ‘The Next Normal: The Rise of the Contactless Economy’, a recently-released report launched by Dentsu India, “a zero-touch and more consumer conscious world has promoted the rise of a ‘contactless economy’ shaped by a virtuallyconnected ecosystem”.

So what’s in store?

Spends will shift increasingly to virtual

  • There will be a growing shift in urban consumers towards using the virtual wallet. As per the findings, close to 60% of transactions of the surveyed audience were fulfilled via virtual wallets, 23% via credit and debit cards and the remaining through cash. A key trend being seen is the reduced need for cash among millennials and gen Z, while the use of virtual wallets has gone up significantly.

  • Banking has seen a sharp shift, with online banking use rising due to the move towards a zero-touch world. Most experts feel that the banking industry is already seeing a permanent shift that has expedited consumer adoption of digital services.  

  • As per the findings, millennial and Gen Z groups expect their banks to master their digital interactions, work to promote greater convenience and devise digital alternatives to meet their day-to-day banking needs.

Online is big and we are not talking transactions alone

  • There has been a huge surge in demand among younger audiences aspiring to upskill themselves, and it could well be a trend that is likely to continue post-lockdown as well.  

  • There has been a move toward focused and tailor-made virtual learning, with nearly 70% of millennials and gen Z agreeing to the likelihood of continuing to subscribe to online education in a post-pandemic world, as per the study.

Shifting purchase behavior

  • When it comes to the purchase of brands and products, more than half of millennials and gen Z audiences surveyed prefer the purchase of local brands as opposed to international ones during the pandemic. 

  • With this shift, product quality has emerged as a big factor, with 55% of gen Z and 65% of millennials putting it as the key reason behind their purchase decision.

Immunity is the way to go for brands

  • One of the biggest impacts since the pandemic has been newfound respect and acceptance for immunity-building consumption across categories. From juices to snacks and air conditioners to bedsheets, immunity could well be one of the most deployed terms among companies. With the virus hitting home, there has been a hyper-awareness of health and safety amongst millennials and gen Z audiences, as per the findings.

  • According to the study, there has been a dramatic rise in demand for immunity boosters, and in many metro cities supplements and superfoods flew off the shelves almost overnight as consumers rushed to consume them in the hope of safeguarding themselves.  

Experts speak

The ‘at home’ economy is going to become huge as we move forward post-pandemic and consumers get used to living in the new hyper-connected world.

  • Gautam Mehra, chief data officer (Asia Pacific) and chief executive of Dentsu Programmatic, said: “Pegged to globally reach a $3trn size by 2025, the ‘at home’ consumption economy has been fueled by the need for consumers to look at digital channels to maintain normalcy in their lives – be it to connect with friends and family virtually, purchase necessities, subscribe to content or discover and learn new skills.

  • “Within this paradigm shift, millennial and gen Z consumers particularly are showing faster adoption of cashless payments and an openness to discover and try new brands.”

  • Being tech natives, gen Z and millennials are already being discussed among brands as the next big cohort to look out for as they become the next generations of cash-rich consumers. Abhinay Bhasin, vice-president (Asia Pacific) and head of Dentsu Marketing Cloud (DMC) Insights, Dentsu International, said: “They will form a cornerstone of new-age marketing and brand engagement, given their growing spending power and digital literacy.”