Additional packaging and increased local consumption: the consequences of COVID-19 according to Nielsen

In a recent report presented by consulting firm Nielsen, it is concluded that regardless of national pride, opting for locally made products can quickly become a necessity for retailers and consumers concerned with products from countries in those that have spread the new coronavirus COVID-19 on a large scale.

Local products and brands have been gaining popularity around the world in the past two years. Consumers tend to associate them closely with supporting local businesses, aligning themselves with pride in what is done nationally, or looking for fresh and own foods that satisfy the preferences of the local palate.

In this case, however, Nielsen's ongoing research into the virus has found that buyers show signs that they may shy away from products that traveled long distances with multiple human contact points, particularly dairy, fruits, vegetables, and meats. .

That means that products leaving factories or relying on distribution systems in the worst affected countries could face challenges, and multinational brands will have to work to maintain consumer confidence.

In recent years, consumers have generally shown a strong preference for fresh and local dairy brands and products, compared to those from abroad. "In the midst of the current crisis, anxiety about the origin of products and ingredients is likely to increase demand for an even more local supply," the document detailed.

What consumers are looking for

First, the report details, consumers need peace of mind. "More than ever, buyers want to understand the supply chain with full transparency from the field to the factory and from the factory to the distribution. They want details of the steps being taken to ensure their safety," explains Nielsen.

In some countries, expanded transparency is already becoming the norm. In China, where populations are emerging from mass quarantines and widespread concerns prevail, the homes of some online food retailers present customers with warranty insurance that includes details of the body temperature of cooks, food packers and couriers for each order, as well as their daily disinfection routines.

Consumers are getting used to this high level of transparency and while they are likely to expect it in everything they buy, it is even more so when it comes to food products.

Promoting the local origin of a product could help manufacturers and retailers allay some consumer concerns. A Nielsen survey on disloyalty last year found that global consumers, like Colombians, claim to be highly influenced by origin: 54% of global consumers bought mostly local products, while in Colombia 69% of the participants did.

Merchants will have to understand the nuances of local concerns, and in this way, smaller local manufacturers may have another advantage as consumer concerns grow. With smaller operations, they may be able to respond faster and more precisely than their larger counterparts, and in doing so could win with local consumers appropriately and on time.

The growth of small manufacturers in the mass consumption industry (FMCG) in the United States, Italy, Portugal, Spain, Egypt, Nigeria and Ghana has outpaced that of the big ones in the last year. With varying levels of market concern, response and impact, local producers and retailers have the added advantage of focusing on an individual market. They are able to adopt fast, focused and unique measures that are relevant to each market.

Some of the measures Nielsen urges to take due to the global pandemic and could prove beneficial to industry participants include:

• Retailers may be forced to become increasingly dependent on local products as supply from abroad is suspended and longer-term quarantines are applied.
• Retailers and manufacturers may want to consider additional protective packaging for global and local products, but will have to balance this with growing consumer concern about the environmental impact.
• Consumers can increase their confidence in locally sourced / produced products in all markets - affected and unaffected - if they can see and identify it, they can trust it.
• Local credentials will be regularly searched and possibly over appreciated.
• Multinationals will have to highlight their global advantages along with their local elements amid growing skepticism about distance-affected supply chains.