The future is not what it used to be: Looking to China’s COVID-19 recovery to understand what is in store for the rest of us
The collective experience of COVID-19 is shrouded in uncertainty, with a whole host of unknowns. We all seek confidence and assurance from expert predictions and data-led forecasts but the reality is we cannot be completely sure what the future will look like. There is no living memory, there is no global experience that exactly matches our current circumstances.
However, there is one source we can look to for guidance on how we should plan for the future. We should look to a country that has been through the trauma of COVID-19 and is now in the process of remission. That country is China, who lifted lockdown measures in March and has been rebuilding society in a post-COVID-19 reality.
We have explored three key learnings from the country’s recovery and used these as a foundation to predict likely scenarios the rest of the world will face over the coming weeks and months and guidance on how best to navigate these events:
3 KEY LEARNINGS FROM CHINA’S RECOVERY
1. REVENGE SPENDING
The social distancing measures provoked by the COVID-19 pandemic has seen online retail go from strength to strength. Amazon has, unsurprisingly, blazed a trail on this front with April sales up 26% compared to the same time last year. While the majority of retail, hospitality and entertainment businesses are still struggling, emerging behaviours from China suggest ‘revenge spending’ may be on the cards for economies worldwide.
In the wake of relaxed measures, China has seen a surge in luxury spending which has fuelled hope for economic recovery. Chinese consumers are, on the whole, optimistic about their country’s economic recovery, despite more than half of Chinese consumers negatively financially impacted by the crisis.
Some suggest the nuanced consumer landscape in the West may mean revenge spending doesn’t impact the US and Europe in quite the same way. Luxury spend fell in Q1, and there has been a growing anti-consumption backlash in the West, as consumers look to limit unnecessary expenditure in a bid to secure their financial futures.
While conspicuous consumption may be off the cards, it does not mean revenge spending will be. As shops and restaurants reopen it is likely we will see a surge in spending.
2. KINDNESS TRUMPS
The corporate response to COVID-19 has been polarising across the globe. While some companies have needlessly forced frontline workers to put their lives at risk, others have worked hard to protect and nurture both employees and consumers.
The re-emergence of professional normalcy in China has shown us that brands and organisations must value the health and wellbeing of their employees and consumers equally.
For some, this is as simple as making consumers feel good as they emerge post-crisis, for others, it is about cultivating community. As a collective culture that cares deeply for the wellbeing of others, as social distancing practices have become an entrenched part of Chinese culture, consumers are spending much more on their social networks to communicate and maintain that sense of care and community.
In response, community-based marketing has grown during the pandemic and continues to be a valuable way for brands to build more meaningful connections with and between its consumers.
As lockdown eases and we are able to return to a familiar existence, it is likely rules around maintaining distance will continue to govern the way we live our lives. The absence of ordinary relationships and relationship-building opens up an opportunity for brands to provide a platform or a space to facilitate the kind of meaningful connections we would ordinarily get from our personal relationships.
COVID-19 has changed the meaning of brands. Now, more than ever, brands must have the health and care of consumers at its core. Extrapolating the learnings from China in terms of creating a strategy, we believe the need for brand kindness is going to be of the utmost importance, while the need for every brand to become a healthcare brand is a new development that will require time, effort, investment and patience.
3. TRUST & TRANSPARENCY IS THE NEW NORMAL, IT IS HERE TO STAY
Many have suggested that life before COVID-19 was problematic in several ways, and as such the pandemic has forced changes in several areas that are likely to remain. While it won’t come as a surprise that it is likely China will continue to see a rise in digital and online retail, the most compelling (and likely the biggest) shift is going to be around trust and transparency.
As China resumes to their ‘new normal’, it takes with it a heightened attention on health, nutrition and sanitation — especially in the world of ‘food safety’. The country has past experience of embedded pandemic changes, witnessing similar consumer behaviour changes following the SARS outbreak in 2002.
Globally, we know that trust in governments is going to be a key part of the recovery process. However, this is something that is increasingly faltering in many countries. It is likely consumers are going to defer to brands to search for trust, expecting increased transparency around its messaging — in particular food, cleaning and beauty products.
THE HUMAN EXPERIENCE (HX) LEARNING: CHANGES FOR THE BETTER?
At Brand Genetics, we are huge believers in the power of innovation and transformative change — whether driven by choice or the need to adapt to a new reality. While we all crave a sense of normalcy and liberty, with so many positive lessons to be taken from the ‘new normal’, do we really want to return to the lives we once led?
In some ways, life has changed for the better: parents have spent more time with their children, hardworking professionals have been able to reconnect with themselves, and we’ve seen a greater sense of community emerge. As China shows us that there are even greater positives to be had on the other side, we must look to learn from this in the same way.
We must seek to use this crisis as an opportunity for growth: harnessing the transparency, innovation, communities and kindness that have been created in recent months and channelling this towards bettering our collective futures. Consumers have witnessed what brands are willing to do, what they’re capable of when they dedicate their efforts and ultimately, they are unlikely to accept less in the future.
Clemmie Prendergast is a consultant at Brand Genetics, an agency specialising in human-centred insight and innovation. With a background in anthropology, she has a wealth of experience in behavioural science and psychology and has worked in strategy, insight and behaviour change.