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Invest in phygital and consumer trust, suggests McKinsey report

By N Jayalakshmi | June 07, 2021

According to a McKinsey survey of global consumer sentiment conducted in April 2021, industries experienced an average 20 % growth in “fully digital” users in the six months ending April 2021, but the digital growth has plateaued in the past six months and may begin to slip back once the pandemic eases.

A  new McKinsey survey has reported that while COVID-19 pandemic drove the rapid adoption of digital channels across countries and industries, digital’s growth has plateaued in the past six months and may begin to slip back once the pandemic eases—even as total digital adoption stays well above prepandemic levels. As per the McKinsey survey of global consumer sentiment conducted in April 2021, companies can look to hold on to newly digital consumers by improving digital experiences, investing in “ phygital and putting consumer trust at the heart of all they do”. 

As per the survey, industries across regions experienced an average of 20 percent growth in “fully digital” users in the six months ending in April 2021, building on previous gains earlier in the pandemic. During that same time period, it was primarily younger people joining the ranks of digital users, it says, “But, with consumers having reached high levels of digital penetration in most regions and industries, the acceleration into digital channels now seems to have leveled off in both Europe and the United States, with consumers in some industries saying that they will be using digital channels less frequently once the pandemic ends. As a result, even as total digital adoption remains above prepandemic levels, many industries and regions may see a modest negative net change in postpandemic digital use relative to 2020,” says the report. 

The industries most vulnerable to the loss of digital consumers may be those that saw the biggest gains in digital adoption during the pandemic, adds the report. “New adopters had little choice during lockdowns but to embrace digital channels, and the channels they entered were more likely to have been newly built and with a less satisfying user experience than established ones,” it said.

According to the report, consumers across the globe tend to have similar expectations and that consumers who had previously been limited (or at least accustomed) to more local, physical-world offerings before the pandemic (for instance, in education and healthcare) had learn to adapt to a digital interface to access these services. As the report highlights, once exposed to best-in-class digital experiences and offerings, the ever more digitally savvy consumers may be reluctant to settle for less.

“Companies can respond by addressing the areas that matter most to digital consumers. According to our survey, these include improved user experiences, better offerings, heightened security and privacy, and phygital expertise, among other approaches. Innovations in digital services may hold the key to further penetrating digital channels, and to staying competitive in the ones that companies have already entered,”  the report advises.

Invest in phygital and consumer trust,  suggests McKinsey report 

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