The Prepared Customer Versus the Panic Buyer
When a consumer’s actual state is different from their desired state, they have entered in to the first phase of the consumer decision process: problem recognition. At the start of the COVID-19 pandemic, consumers across the United States entered into the problem recognition phase of the consumer buying process at the same time, resulting in supply chain shortages. While it has been observed that consumers were needlessly panic-buying in March and April of 2020 (Reiley, et al., 2020), it is important to understand that it is a “consumer’s perception of the actual state that drives problem recognition, not some objective reality” (Mothersbaugh, et al, 2016, p. 503). This means purchasing decisions by both panic buyers and prepared customers are driven not solely by their actual state (a need for a product), but also by their perception of their actual state (perceived need for a product).
In the spring of 2020, consumers were influenced by social norms, specifically “standards that develop from observations of others’ behavior” (Melnyk, et al., 2019, p. 5), and the “psychology of empty shelves” (Reiley, et al., 2020). Essentially, as consumers stocked up on specific items, more consumers were motivated to stock up on those specific items, shifting the consumer’s perception of their actual state. It is important to understand how heavily perception influences purchasing decisions.
Panic Buying and Supply Chains
In real time, the United States witnessed the effects of panic buying on supply chains. Supply chains were not able to keep stores stocked as anxious consumers purchased “cleaning supplies and any non-perishable foods” (Kunkle, et al., 2020). Additionally, while panic buying was undoubtedly a factor in shortages during the spring of 2020, the distribution system and supply chains in America were not structured to support most Americans conducting all facets of life at home, including meals (Reiley, 2020). To combat these supply chain issues, retailers and manufacturers simplified supply chains and increased employees at warehouses and fulfillment centers (Reiley, et al., 2020).
The shortages and subsequent challenges from those shortages demonstrate the importance of the problem-solving timeline – that is, recognizing the consumer’s “potential problems before they become actual problems” (Mothersbaugh, et al, 2016, p. 512).
Stress on the Supply Chain
Before the pandemic, food accessibility was challenging for a “significant portion of the population” (Meyersohn, 2020) of the United States. Panic buying, while detrimental to availability of products, was not the only factor for empty shelves and sporadic product deficit this past spring. External factors, such as “economic, political, social, environmental, and health” (Valdez-Juárez, et al., 2021, p. 1), were also responsible. Solutions available to economically stable and affluent Americans are not available to struggling Americans. Many Americans do not have internet access, resources to afford inflated prices for grocery delivery services, or grocery delivery that serves their communities (Meyersohn, 2020). Supply chain challenges and empty shelves compounded this problem, particularly as these communities are historically a low priority for food accessibility (Meyersohn, 2020).
Prepared consumers’ shopping habits affected shelves as well, focusing on smaller varieties of products instead of the breadth of grocery store offerings (Reiley, 2020), for a number of reasons. These small changes in consumer behavior have had a butterfly effect across supply chains (Reiley, 2020), as America’s supply chain was not structured to support these monumental, simultaneous shifts in consumer behavior. Unexpected and unplanned shifts in consumer behavior overwhelmed the supply chain, preventing prepared consumers and panic buyers from making purchases.
Shift to Continuous Shopping
Due to the pandemic, “traditional sales channels are no longer the preferred means of purchasing products for consumers” (Valdez-Juárez, et al., 2021, p. 4) and there has been an observed increase in mobile shopping (Aydınlıoğlu, et al., 2020, p. 14).
This makes consumer behavior data more accessible to retailers (Bauerová, 2018, p. 1241), providing unique opportunities to meet consumer needs in a responsible way. Virtual retailers have the opportunity to prime consumers with aesthetically appealing branding and messaging (Nicolao, et al., 2016, p. 22), a seamless and intuitive shopping experience, and cross-platform communication in a “continuous nature” (Faulds, et al., 2018, p. 327), delivered to consumers’ mobile phones to remind consumers to complete purchases (Ozarslan, et al., 2018, p. 6).
Moving forward, retailers can use this data to understanding consumer needs and expectations, improve the customer experience, and streamline the supply chain.
References
Aydınlıoğlu, Ö., & Gencer, Z. T. (2020). Let me buy before I die! A study on consumers’ panic buying behaviours during the Covid-19 pandemic. Turkish Studies, 15(6), 139–154. https://doi.org/10.7827/TurkishStudies.45454
Bauerová, R. (2018). Consumers’ decision‑making in online grocery shopping: The impact of services offered and delivery conditions. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 66(5), 1239–1247. https://doi.org/10.11118/actaun201866051239
Faulds, D. J., Mangold, W. G., Raju, P. s., & Valsalan, S. (2018). The mobile shopping revolution: Redefining the consumer decision process. Business Horizons, 61(2), 323–338. https://doi.org/10.1016/j.bushor.2017.11.012
Kunkle, F., & Ruane, M. E. (2020, March 13). Coronavirus triggers run on grocery stores, with panic-buying, hoarding and some fighting, too. Washington Post. https://www.washingtonpost.com/dc-md-va/2020/03/13/coronavirus-triggers-run-grocery-stores-with-panic-buying-hoarding-some-fighting-too/
Lee, S.-H., & Workman, J. (2020). How do face consciousness and public self-consciousness affect consumer decision-making? Journal of Open Innovation, 68(4), 1–15. https://doi.org/10.3390/joitmc6040144
Melnyk, V., van Herpen, E., Jak, S., & van Trijp, H. C. M. (2019). The mechanisms of social norms’ influence on consumer decision making: A meta-analysis. Zeitschrift Für Psychologie, 227(1), 4–17. https://doi.org/10.1027/2151-2604/a000352