Consumers in the time of coronavirus

There are plenty of unfamiliar sightings and perplexing behaviours around these days. Beyond creative face masks, dexterous opening of park gates with feet and people humming ‘Happy Birthday’ while washing their hands, for Londoners nothing is more of an oddity than the uplift in neighbourly relations.
 
It’s remarkable to think that the past weeks have been spent delivering eggs and toilet paper to elderly neighbours, organising communal watering of trees no longer tended to by the council and sifting through a constant stream of messages on a local WhatsApp group. In a matter of weeks, Covid-19 has done what Cameron’s Big Society failed to do in six years.
 
And yet these are not the only bonds that are shifting. As an unforeseen consequence, the early signs are that the shutdown is helping the environment to recover – Venetian canals are teeming with fish, New Delhi skies are a lighter shade of blue, pollution in New York has reduced by half. Let’s hope this has an enduring impact on our relationship with the natural world.
 
In spite of the Brexit fiasco, we now rely on and listen to our leaders more than ever. They are reminding banks to repay the favour of being publicly bailed out in 2008. In return, businesses are helping the national effort by producing ventilators, face masks and hand sanitiser (thanks to all the gin distilleries who have now switched to co-making two ‘essential’ products).
 
We revere the NHS more than ever before (we have never joined in rhythmic clapping with neighbours for anything else) and brands across the country have been doing what they can to support medical and key workers. Our brands too have been playing their part. Frame is offering free online fitness classes to all frontline workers, Mindful Chef is providing NHS workers with heavily discounted meals, Turtle Bay is delivering takeaways to nearby hospitals and, as a small gesture, Bloom & Wild and Monica Vinader are sending them free flowers and jewellery.
 
This too is a difficult time to be a pet owner. To help, Barking Heads is providing 9,000 meals to pets whose vulnerable owners are most in need while in isolation, while Forthglade is supporting Dots London which temporarily fosters dogs of homeless and other vulnerable people admitted to hospital. Bruce’s is helping to look after key workers’ dogs while they are at work.
 
Overnight, supermarkets and delivery brands such as Amazon, Deliveroo and Mindful Chef have become essential service providers, a public utility. Supermarkets have accepted their new role with grace by seeking to pay suppliers immediately, implementing rationing and prioritising making food accessible to those in need. In return, brands are rewarding people who are going the extra mile – PROPER’s #supermarketlegend campaign has gone viral, complemented by them giving free bags to all Costa Coffees in hospitals. Flat Iron is supporting small farms and producers by encouraging customers to buy meat, cheese and chocolate directly from them.
 
Landlords come in many breeds. Some of the bigger institutional ones that curate brands have responded quickly in supporting their tenants as true partners with rent-free periods, while others are sending legal letters demanding payments. How landlords respond to these times will determine their reputations and their ability to fill the meteoric rise in vacancies.
 
Brands, while trying to keep afloat and switching as much as possible to online selling, are attempting to build long-term, non-transactional relationships with consumers by investing time in talking to their customers and engaging in broader brand-building. For example, Neom has been building on its ‘Small Steps. Big Difference’ initiative by helping people find precious moments of wellbeing in their homes. And consumers are responding. The announcement of the closures of our restaurant brands have seen outpourings of support from guests. The public mood has never been more supportive of entrepreneurship.
 
Covid has also exposed the internal cultures of businesses. Those with motivated and valued teams have seen this as an opportunity to galvanise their spirit and work together to get through this. Those without are facing the tough task of persuading people to work diligently for them for a reduced salary and to stick with them when this is all over. We have seen some extraordinarily open-hearted and candid letters from our founders to their teams.
 
As investors in consumer brands, we are especially fascinated by how consumers are changing their behaviour in the short-term and more permanently. So, over the coming weeks, we will be focusing on consumer sectors that we feel have been disrupted, potentially forever. We will be sharing insights from research that we are currently conducting with consumers all over the country, speaking to them about what they are eating and drinking, doing to their homes, how they are staying fit and healthy and, of course, keeping themselves happy and entertained.
 
We hope this will help you in seeing some new opportunities during these turbulent times. In the meantime, we at Piper wish you all the best in navigating through the challenges ahead.

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