Hunting for Novelty
Today it seems like the world is slowly edging back towards normality, with many countries re-opening schools, parks, non-essential commerce and restaurants. As companies think beyond the tactical and defensive aspects of the crisis, some will begin to discover opportunity in shifts of consumption behaviors which have been reshaped by the crisis.
Competitively speaking, it becomes a game of seeing deeper and acting faster than others on new patterns. We have written elsewhere about using granular, high frequency data to detect emerging patterns in consumption and about distinguishing between temporary and more permanent shifts. One way of seeing beyond the behaviors that are already manifest is to look at shifts in the beliefs that shape new behaviors. Major social events that affect our health, security and relationships can provoke profound changes in beliefs and social norms. Such changes are not necessarily visible right away, but they can shape multiple future behaviors. Understanding shifts in beliefs allows leaders to go beyond spotting existing consumption trends and anticipate potential new needs, support and reinforce them, and create advantage in serving them.
When exploring possible COVID-induced demand shifts, companies often implicitly use the mental model “situation — new behaviors — future habits — demand”. Indeed, behavior is a function of the person and the situation, and new situations thus lead to new behaviors (Ross and Nisbett, 1991). When the new context persists and the new behaviors become automatic, new habits are formed (Lally et al., 2009). Those habits then reshape demand in a persistent fashion. Following this logic, companies search for the new behaviors that emerged in the COVID crisis and try to predict whether these behaviors will stick and create new habits — or fade away as the situation normalizes. Advantage becomes a matter of detecting anomalies sooner, better interpreting them and acting on them rapidly.
While this is perfectly valid, another pattern can arise when events happen that affect people profoundly: “situation — new beliefs — future behaviors — demand”. That is, a new situation not only can create immediate new behaviors, but it can also shape personal beliefs, and through this, shape future behaviors. Beliefs are usually hard to change because they are neither highly transparent nor controllable. Nevertheless, major events can cause people to modify their beliefs (Levy et al., 2006; Kaiser et al., 2009). Beliefs revision can have lasting and complex effects on behaviors and demand.
Could the COVID crisis have modified not only behaviors but also belief systems? Such a hypothesis seems highly plausible. History shows many examples of such modifications following major social disruptions. The Black Death and World War I are both believed to have modified attitudes towards religion and society in complex ways (Ziegler, 1991; Houlihan, 2015), and the Napoleonic wars are believed to have contributed to the shaping of beliefs about nationhood in Europe (Rowe, 2013). A more recent example of belief revision due to a major social event is when the endorsement of meritocratic beliefs decreased amongst African Americans in 2005 following Hurricane Katrina, which they considered inadequately managed by the government (Levy et al., 2006).
Seeing the possibility that COVID-19 is shaping beliefs opens up a new opportunity field for several reasons:
1. Beliefs revisions drive new behaviors and habits. Let’s take a simple behavior — home cooking. With constant beliefs, home cooking can become a future habit if it was practiced for a sufficiently long time, if during this time it was enjoyed, if necessary resources are available to continue the activity, if the involved frictions are not too high (e.g. buying food for it or washing the kitchenware) and if alternative choices are unavailable or less attractive (e.g. take-away or eating out options). Beyond this, however, changes in beliefs about family, time at home, or the importance of good food can also influence future behaviors beyond the binary possibilities of “continuing vs. terminating” the new behavior pattern. For example, such beliefs revisions could motivate people who did not have any cooking experience during the lockdown to start cooking afterward. Taking beliefs into account helps us make better predictions for both visible and invisible behaviors.
2. Beliefs revisions drive multiple new behaviors. Beliefs can be broad in scope and influence. This means that one belief modification can drive multiple behavioral changes. A new realization of the preciousness of family time can reinforce new home cooking habits, while also boosting other family-centered behaviors — doing sports together, travelling together, entertaining at home, and so forth. The impact can therefore be much broader than the acquisition of a single new habit.
3. Beliefs revisions are sensitive to support and reinforcement. Instead of only predicting and adapting to changed behaviors, companies can try to support and reinforce the expression of new beliefs in new behaviors. In the case of new habit formation, companies can mainly intervene by addressing the drivers of behavioral stickiness — increasing the enjoyment and the length of behavior adoption, reducing frictions and increasing availability of necessary resources. For example, free subscription to home cooking kits during or just after the lockdown can help in creating an enjoyable habit, while decreasing frictions associated with ingredient purchase and preparation.
However, beliefs tend to be more sensitive to support and reinforcement once unfrozen by a major event. An individual may feel an emerging need to spend more time with the family, but without any support and reinforcement, reversion to the previous working regime can make this need fade away. In such a state, when beliefs are unstable, people are sensitive to opinion leadership and more open to new ideas. For example, authoring an article exploring family values and how to find time for them, or using family-oriented marketing messages, are ways to support and reinforce beliefs on family time and position yourself to serve new needs and behaviors. Of course, such activities must not be manipulative or misinformative; rather, they should be authentic to the business and aimed at helping people realize and serve their own beliefs.
How to understand and reinforce beliefs
How then can beliefs be understood and reinforced?
Since changes in beliefs are not directly observable and may not drive immediate behaviors, it is not very useful to search for beliefs revision in basic consumption patterns. Instead, you need to be more creative in finding ways to uncover emerging beliefs.
- Survey for beliefs. When conducting a survey, try to understand what is going on in the consumers’ lives: what new experiences impacted them and how they shifted what they believe or hold as important.
- Infer beliefs. It can be challenging for individuals to articulate their beliefs and how they might have changed. What they believe they believe may not be what they actually believe. In this case, one can test feelings towards different hypothetical scenarios or choices to infer beliefs.
- Test&learn. Be creative in finding your own ways to test beliefs changes. For example, the use of A/B testing in marketing messages can allow you to see what makes people “tick”.
Reinforcing beliefs requires articulating a position and being ready to actively support it through further messaging and through appropriate innovation in the product or service offering.
- Reengineer your influence cascade around beliefs. Leveraging influencers, participating in high-visibility activities, and developing thought leadership are some ways in which companies can support and reinforce beliefs. It is important to be authentic, so that messages are not seen as being only self serving, instrumental and promotional.
- Cooperate. Nurturing beliefs is easier together. Allying with like-minded brands and organizations, founding an initiative or an association, or leveraging government cooperation can help magnify efforts.
- Reinforce beliefs with new offerings. New offerings can help companies support and reinforce beliefs and build an advantage in serving them. A historical example of this is the disposable baby diaper, which was introduced after the WWII. Despite strong initial resistance related to the old beliefs (“women have time and should change babies as required”), the product was launched, supporting the new belief (“women need more time to work and travel”). Innovation has not only leveraged beliefs revision and became commercially successful because of this, but it also contributed in a more fundamental way to changing those social norms and beliefs.
New patterns of demand are starting to become evident. Some players have seen new demand patterns and made bets that may be starting to pay off, be it hygiene products, cycling, collaboration software or countryside real estate. Those wishing to anticipate the shape of post-COVID demand and build an advantage now need to go beyond addressing the obvious shifts. Identifying beliefs revisions that others have not seen and building a unique advantage around them is one way of doing so.
Alexandra Slepova is a principal in the Paris office of the Boston Consulting Group. She can be reached at firstname.lastname@example.org
Martin Reeves is a managing director and senior partner in the San Francisco office of Boston Consulting Group and the Chairman of the BCG Henderson Institute. You may follow him on Twitter @MartinKReeves and contact him by email at Reeves.Martin@bcg.com
Kevin Whitaker is head of strategic analytics for the BCG Henderson Institute in New York. He can be reached at email@example.com
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