Faced with challenges in securing their usual or desired products and services, Backup Planners are looking for ways to purchase similar items or finding creative solutions to obtain alternatives. Supply chain shortages are forcing businesses to pivot and provide new solutions for customers to access products and services.
Finding Creative Solutions or Resorting to Alternatives
Due to limited resources, consumers are struggling to secure their go-to products. As social occasions and discretionary spending return, consumers want to buy new clothes, invest in home renovations, or simply enjoy coffee on the go. However, the effects of COVID-19, particularly disrupted supply chains and staff shortages, exacerbate the issue.
Backup Planners are getting ahead of the crowd, taking control, and using technology to move to the front of the queue when supplies are threatened. Certain consumers are relying on subscription services or community group buying to secure deliveries.
When thwarted, Backup Planners are reverting to the next best option, seeking alternatives and in some cases, delaying purchases or changing shopping habits. Two extremes are influencing shopping behaviours of Backup Planners—paying a premium or switching to cost-effective options, such as buying second-hand or renting.
Rethinking the Supply Chain
Product availability drives profit. Supply shortages can weaken customer loyalty. Companies must be able to secure the necessary materials to manufacture products whilst providing exceptional service.
Businesses can leverage opportunities where others fail to deliver. Rental or refurbished products give consumers additional options and access to alternatives. Backup Planners may also pay more to get first access to their preferred products. Implementing exclusive or presale items at a premium could entice these consumers and drive revenue.
Mobile apps that enable digital waitlists and queuing allow consumers to secure their place in line and help businesses control traffic. Additionally, direct-to-consumer services can bring products straight to the consumer’s door. Companies need to invest in local sourcing and automation to overcome shortages. In the interim, prices may need to increase to help compensate. Splitting costs with other players to buy ingredients or components in bulk could be an option to ensure continuous supply.
PepsiCo launched two direct-to-consumer sites in 2020. Consumers can order specialised bundles, such as “Rise & Shine” and “Workout & Recovery” on PantryShop.com or purchase individual items on Snacks.com from PepsiCo’s food and beverage portfolio.
By late 2022, supply chains should start to stabilise and access to products should revert to pre-COVID-19 levels. Yet, new shopping habits will dictate how Backup Planners discover and select products, from locally sourced to direct-to-consumer brands to subscription services. Localisation and optimisation will become the norm. Companies and distributors should use data to improve supply chain visibility, hone operations and rethink investments.