Even though Eastern European consumers have been traditionally frugal due to lower levels of income, the pandemic has made them more price-conscious. This ‘scenario consumer’ however still wants to spend their money, preferably without compromising on quality: bands need to find ways to cater to this customer of post-pandemic era.
Eastern European countries have faced several critical periods over just the past decades: the Yugoslav wars, the Ukrainian revolution, and the region-wide or global events, such as the change of regime, the financial crisis and now the COVID-19 pandemic. These phenomena heavily influence the decision making of the consumer society and shape their attitudes over the years.
Even before the pandemic, Eastern European incomes were lower than not just Western Europe, but even the global average, making the Eastern European consumer truly price-conscious and frugal. This mindset is also accompanied by a lower level of trust in banks, making this prudent attitude harder to change. The average consumer is looking for good value for their money, preferably without any huge compromise on the quality. In the field of consumer appliances, global brands are losing to cheaper, mainly Chinese brands, even though they are also ready to adapt with cheaper options in their line-up.
Ceasing economical boost, increasing thriftiness
Although the region has fallen behind well-developed regions, before the pandemic this gap was closing as the Eastern region as gaining on the Western Economies. However, the pandemic broke this tendency: due to the economically volatile environment and insecurity of jobs, this price-conscious attitude just intensified, forcing brands to devote extra attention in catering to CEE consumers.
COVID evoking the ‘scenario consumer’
Dr. Mária Törőcsik, Economist and Profession at University of Pécs and guest author in the CANnual Report 2021 describes the consumer evoked by the pandemic as a ‘scenario consumer’. Since the change of regime, we saw the ‘predictable consumer’, ‘unpredictable consumer’, ‘crisis consumer’, ‘enlightened consumer’, and now the ‘scenario consumer’.
“A consequence of uncertainty is panic shopping, accumulation of reserves, and thinking in scenarios coming from situations induced by external factors: “if this happens, then…”. This is a new situation for most of the consumers, as future used to be plannable, and the outcomes of the decisions made could be more or less predicted. The series of challenges wore people out, forcing them to change their existing habits in some way. The rapid unfolding of the situation, its global character and the understandable uncertainty of the decision-makers were thought-provoking, parallel to the new focus on a basic need, the protection of life – to which different groups had different adaptations.”
Although frugal, the ‘scenario consumer’ still wants to spend their money: despite the pandemic, they don’t seem to restrict their consumption, but brands have to adapt to these new attitudes: promotional offers and interest-free credits are already used to maintain or even increase the basket size of frugal Eastern European consumers.
For more information on consumer behaviour changes, download the CANnual Report 2021!