Future Unseen – Will Behavioural Changes Forged During Covid-19 MCO Persist?
Ordinary life in Malaysia, as we know it before the Covid-19 MCO (Movement Control Order), may take a while to regain its original rhythm and form after the lockdown is effectively lifted. Markets are poised to undergo sweeping changes as consumers are forming new habits, making new discoveries, contemplating and drawing up new contingency plans in anticipation of many uncertain scenarios ahead. Economic challenges post the nationwide MCO are hitting businesses and, forming a cycle with changing consumer habits, altering the business landscape as well.
At STRATOS, we’ve drawn up the core areas of change amongst consumers (business will be covered in the next post). As habits are said to be formed over a period of 21 days and with most lockdowns lasting longer than this, we reflect on these core agents of change by asking key questions, without resorting to prematurely casting the outcome.
1. Personal / Public Health
MCO and the public awareness of various forms of lockdown implemented successively around the world, in response to escalation of infected cases, have driven into the mindset a sense of vulnerability among the public over the highly infectious nature of Covid-19. The worldwide message has been that your home is now the safest as well as the most effective place in fighting this global public health battle.
This sense of vulnerability is not expected to end soon. 18 days into the MCO, the Director General of Health, Datuk Dr Noor Hisham Abdullah said that even after the MCO ends, mass gatherings may not be allowed for another 6 months, and other habits such as social distancing will still be encouraged.
With such a prognosis, barring any short-term discovery of an effective vaccine against the virus, consumers will have to be used to living with the sense of heightened need for safety and protection.
1.1 Key questions 6 months after Covid-19 MCO
|a) How safe will people feel about taking airlines, coaches, cruises and public transportation?||– Travel and Tours (airlines, cruises, other public transportation, tour agencies, MICE or meetings, incentives, conferences, events)|
– Air BNB
|b) Will people view face masks and hand sanitizers as a necessity whether or not there’s an epidemic / pandemic?||– Medical |
– Pharmaceutical (drugs, health supplements)
– Manufacturers / Exporters / Importers of personal health, protective and medical products & equipment
– TCM (traditional Chinese medicine)
|c) Will parents and students be more accepting to home-based / virtual learning?||– Online learning and training platforms / apps |
– Remote conferencing services
– IT equipment
– Telecommunications network & equipment
– Tuition / child enrichment / training
– Edutainment centres
|d) Will increased isolation at home lead to worsening mental health?||– Pharmaceutical (drugs)|
– Mental health & therapy services
2. Economy / Job Security
The disruption of the MCO on economic life is wide-ranging. Bank Negara’s forecasted GDP growth in 2020 is 0.5% at best and -2% at worst, with anticipation that unemployment rate will increase to 4%, from 3.3% in 2019. After the government announced a 2nd stimulus package widely seen to be mainly benefiting consumers, a special stimulus package was announced on 6th April to help SMEs, many of which are saying that they face the prospect of collapsing.
Emerging from MCO, consumers are being pushed to secure themselves financially against challenging times.
2.1 Key questions – immediately after Covid-19 MCO
|a) Will people take the initiative to take up a second job?||Outsourcing / gig sector|
|b) For those who lose their jobs, will stable employment be replaced by gig jobs?||Gig sector|
|c) Will people cut spending in order to shore up saving?||– Consumer discretionary goods and services (eg. durable goods, apparel, jewellery, cosmetics, entertainment and leisure, automobiles)|
– Lifestyle F&B outlets
– Stocks, bonds, unit trusts, other investments
– Banking & finance
|d) Will people start relinquishing asset ownership to build up reserves?||– Property |
– Stocks, bonds, unit trusts, other investments
– Banking & finance
3. Personal Connection Habits
While MCO imposes isolation on households, social connection may not have taken a beating as much, thanks to digitalization. But is virtual connection as good as, if not better than physical connection? 28 days of staying at home (barring extension) might prove to be a good time frame to find out.
3.1 Key questions – immediately after Covid-19 MCO, barring any official directive or otherwise
|a) Will increased virtual conversations and gatherings become a staple?||– Social media|
– Virtual social connecting platforms
|b) Or, will small gatherings be organized with more frequency than before due to pent-up effects, by-passing social distancing among close kin and friends?||– F&B outlets|
4. Shopping / Dining / Entertainment / Fitness Behaviour
Delivery, e-wallet and men doing grocery shopping for their wives are adjustments made in order to comply with the MCO. Due to logistics disruption and closure of certain types of wet markets during the MCO, a number of vegetable / fruit / meat farms and suppliers have also resorted to delivering direct to consumers, through online orders. However, consumers also learned that the surge of demand for grocery delivery also means higher cost, non-availability of delivery in some areas, long waiting list, and questionable goods quality. For dissatisfied consumers, the adaptation online may not translate to a habit that sticks post MCO.
Many are also cooking more than they used to as dining options narrowed. If cooking used to be a hassle, it has changed over the years with the help of improved kitchen appliances and online recipes. Can this ‘enforcement’ alter the habits of the food-loving Malaysians to eat at home more?
Prior to Covid-19, going to a shopping mall in Malaysia was viewed as a family or social outing / entertainment. Will this attitude change in the future? Or rather, how long will it take to return to normalcy?
The self-isolation period has given rise to increased downloads of e-games worldwide. Will we be seeing more e-gaming converts among all ages and genders post MCO?
4.1 Key questions – 3 to 6 Months after Covid-19 MCO
|a) Will online grocery shopping become more of a norm?||– Groceries and household goods (supermarkets, hypermarkets, convenience stores, fresh produce suppliers)|
– Distribution & logistics
|b) Will the online grocery shopper switch to offline shopping at wet markets / stores for better quality/ more hands-on experience?||– Same as above|
|c) Will people become more comfortable cooking and eating at home and are less attracted to dining out?||– Same as above|
– F&B outlets
|d) With greater awareness of social distancing, will people continue to opt for more take-away or food delivery options?||– F&B outlets|
|e) With health considerations foremost on their mind, will more people opt for contactless E-Wallet payment options rather than cash / credit card?||– E-wallet operators|
|f) How will Malaysian attitudes towards family and social outing options change, if at all?||– Shopping malls|
– Entertainment outlets (cinemas, karaokes, amusement centres, etc.)
|g) Will new e-gaming converts find the hobby more than a passing fad?||– E-gaming|
|h) Will attitudes towards fitness options change in the longer term?||– Gyms / indoor sports centres|