Customer Behavior During COVID-19

At Retina, we know the importance of providing the right value for the right customer. However, these are trying times for many consumers. During COVID-19, companies are either going to make or break relationships with long-term customers.

Today’s heroes are the healthcare providers saving lives, utility companies continuing to provide service, and media companies keeping us up-to-date. I think that we will have a newfound appreciation for these heroes and we are unlikely to take them for granted in the future. However, there are other unsung heroes: employees of essential businesses like grocery stores, restaurants, and mail and delivery companies.

As consumers, we are focusing on our most basic needs. And most of the products we are currently using are commodities. In my opinion, it’s more important than ever to show care, compassion, and respect for the people working hard to get us these products.

The obvious behavioral change we’re seeing is a dramatic shift toward eCommerce businesses and food delivery marketplaces. The questions we are often asked is: What kind of changes are we seeing with our clients? Below are some of my thoughts on the consumer behavior changes that I am observing in the current market.

High-Value Customer Behaviors

1. Essential offline sellers are earning loyal customers.

A local coffee shop in our neighborhood is still open and it’s a lifeline for my wife. I am sure that their courage and service has earned them a very loyal customer in her. The same is true for a smoothie shop that is offering delivery during this time. And for grocery stores like Trader Joe’s that are working hard to keep stores sanitized while serving customers.

Build Lookalike Audiences

2. Shoppers are discovering new eCommerce for nonessential products.

In the current environment surrounding this devastating crisis, many products that are typically viewed as offline essentials (hygiene and beauty products, for example) are going online. Companies like Dollar Shave Club and Madison Reed will likely see renewed growth. Many customers will shift their behavior to make these purchases online for the long term.

Customer Lifetime Value Modeling Company

3. Well-known eCommerce brands will continue to struggle with supply chain issues, enabling new entrants.

We are seeing a big difference between Amazon and Target in this market. While Amazon is experiencing a surge in demand, they are unable to meet customer needs and can no longer deliver items within a two-day timeframe. Target, however, can utilize its local supply chain to get essential products to customers within one day. Brick and mortar stores have a huge opportunity to come back. But, with the recent news at Macy’s, new entrants to the market must be prepared to gain an advantage.

RFM Segmentation

4. Luxury brands will see lower demand and many will shut down.

Many of the direct-to-consumer brands that have popped up in the last decade will start to struggle. The underlying behavior will be driven by consumers worried about their job security and by the increase in overall unemployment. As a result, venture-capital driven luxury brands will have a much harder time fundraising and will likely see their valuations decrease.


Many companies are in a weird holding pattern. They are unsure of what to do next because this crisis has impacted their employees as well. My recommendation is for these companies to look at projected customer behavior at the individual level to identify which customers are in need. Focus on customers that are switching their behavior to higher frequency purchases. Serving these customers well during this time will not only increase their LTV but also their loyalty. These customers are more likely to share their experiences with their friends and help companies grow organically.