In mid-March we undertook our first global COVID-19 study examining the effects of the pandemic on consumers. By July, we’d reached our fifth successive wave of this research.
We’ve been able to track how we got to where we are today, while also exploring how countries have experienced the pandemic differently around the world.
This is the story so far.
1. Concern is falling, but so is optimism.
When it comes to concerns about the situation in consumers’ own countries, globally we’re observing a downward trend as nations around the world begin to make progress in controlling the virus.
While concerns increased through March reaching a high of 71% of consumers, this has fallen to 61% in early July across the 13 countries we’ve tracked consistently throughout our research.
The U.S. and UK follow this downward trend, but they remain slightly above the average. In both nations, 74% of consumers are concerned about the virus right now, having dropped from around the mid-eighties in April.
At 45%, and far into its COVID-19 journey, China is the least concerned country – a theme that’s remained consistent in our research. But its level of concern has risen slightly from 41% in mid-May, perhaps due to clusters of outbreaks and localized lockdowns in the country.
Australia has observed a similar pattern, jumping from 61% in May to 66% in July which coincides with the localized lockdown in Melbourne.
In countries such as Brazil, where the virus is spreading rapidly and yet to show signs of being under control, a very high proportion of the population is still concerned (93%), a figure that hasn’t wavered across all 5 waves of research.
In terms of how long consumers expect the virus to last in their own country, this continues to rise across all countries tracked. In mid-March just 20% expected it to last longer than 6 months in their own country, by July this has increased to 63%.
But are consumers optimistic they’ll overcome it?
The majority are, but they’re less optimistic than they were four months ago. 64% of consumers are optimistic their country will overcome the pandemic, falling from 70% in mid-March.
While concerns are falling, this trend is incredibly fragile. If a vaccine was discovered tomorrow we could expect this to accelerate, but likewise a “second wave” of infections would undo the progress made. And consumers are consciously aware of the threat of a second wave.
2 in 3 consumers globally are concerned about a potential “second wave” in their country.
This was the average of the 18 countries tracked in our fifth wave of research. What’s obvious is that the uncertainty around the virus and the threat of a second wave makes brand planning very difficult – the situation can literally change overnight.
This really underscores the importance of using consumer research to continually keep up-to-date with changes in consumer perspectives and behaviors in order to be able to adapt as we move forward.
2. Younger generations are more likely to have been furloughed.
When it comes to the pandemic’s effect on our personal/household finances, we’re back to where we were in mid-March.
Then and now, 31% of consumers globally say it will have a big or dramatic impact. This reached a high of 38% in April, suggesting consumers think they’ve overcome the worst.
The expected impact of COVID-19 on households in Europe’s largest economies is below the average, 25% of consumers in France expect the pandemic to impact their finances, dropping to 23% in the UK and 19% in Germany.
Italy and Spain appear to have been hit harder though, scoring 38% and 40%, respectively.
When it comes to the impact on their job, the percentage of consumers who’ve been temporarily laid off or furloughed globally has fallen slightly across 15 markets surveyed – from 15% in April to 12% in July.
But more consumers report having had a bonus/payrise deferred, a paycut, or reduced working hours. This may be because governments around the world are reducing furlough subsidies and so companies are bringing employees back on but are having to make cuts elsewhere.
At 16%, Gen Z are the most likely to have been furloughed.
This supports evidence that says this generation will be hit the worst financially by the pandemic.
Consumers in low income brackets are also more likely to say they’ve been temporarily laid off or placed on furlough (14%), compared to high earners (10%). Low earners are also twice as likely to say they’ve lost their job because of the outbreak than high earners (10% vs. 5%, respectively).
Blue collar workers, especially those in struggling industries such as hospitality, haven’t been able to work from home during this period and have been disproportionately affected financially by the pandemic. This has likely increased global inequality.
3. Less consumers are delaying purchases like vacations.
The economic uncertainty is also significantly affecting consumer spending.
Across the 13 markets surveyed in March, just 15% of consumers had delayed purchasing luxury items, this has gradually risen to a high of 25% in July.
The travel industry has arguably taken one of the biggest hits.
Between March and May, the number of consumers delaying purchasing a vacation or flight slowly ticked upward. For flights it increased from 26% of consumers in March to 33% in May. Meanwhile, for vacations, the spike was even greater, from 41% to 53%.
That said, things appear to be improving in July, with less consumers reporting they’ve delayed either flights (30%) or vacations (50%).
Indeed this is still high, but it’s the ray of sunshine airlines and hospitality providers have been waiting for as travel corridors begin to open up.
4. New habits die easy, but streaming services are coming out on top.
Everyday life has changed significantly around the world as a result of COVID-19 and subsequent lockdowns. As consumers find themselves with more free time, they’ve been looking for ways to entertain themselves at home.
Unsurprisingly, consumers have been spending more time watching news coverage. This has been the top activity reported across all waves, however it’s become less popular over the last four months, dropping from 67% of all consumers in mid-March to 56% in July.
This downward trend is likely propelled by coronavirus fatigue as consumers look to escape from the COVID-19 infodemic.
In July, just 36% of U.S. consumers say they’re watching more news coverage because of COVID-19; they’re more likely to report spending more time watching shows on streaming services such as Netflix (46%).
Many consumers have reported spending more time doing activities which can be done independently; such as listening to the radio, reading books, cooking, and watching shows on streaming services such as Netflix.
The percentage of consumers taking part in these types of activities has remained relatively consistent across all five waves of research up to July.
Watching streaming services is by far the most popular option, with over half saying they’re doing this more during the pandemic.
At the beginning of March, online activities which offered a gateway to both entertainment and socializing online were very popular. These included using messaging services, spending longer on social media, using apps, and playing video games. And now, over the past few months, it seems consumers are doing these activities less.
Spending more time on messaging services has fallen from 45% in March to 39% in July.
While consumers are still using their online devices more than they were before, as we enter this new normal, this is also beginning to decline. In July, 69% of internet users are still spending more time on their smartphones, while this figure stood at 75% in late March.
Lockdowns are still in place around the world, but they’ve become less intense in many nations. As consumers return to their jobs and normal lives, we can expect media consumption to shift back toward pre-COVID levels.
Despite this, the outbreak has certainly accelerated streaming services as the go-to form of entertainment – Netflix added 15 million new subscribers within roughly 4 months this year and Disney+, which launched in November 2019, has already racked up 50 million subscribers, growing much faster than its rivals did.
A trend that could have taken years has been accelerated in just 6 months.
5. There’s been growing demand for “normal” advertising.
Since late March, the majority of consumers approve of brands running advertisements that show how they’re responding to the pandemic and are helping customers, however, this has gradually fallen from 82% to 77%.
Additionally, 54% of all consumers globally approve of brands running “normal” advertising campaigns, this has steadily increased from 51% in late March and reached a high of 56% in May.
Signs are beginning to show that consumers are ready for advertising to take a step back from COVID-19 content.
This trend toward returning to normal is strongest in New Zealand, which has been one of the most successful countries in combating COVID-19. In March, just 35% of consumers there approved of “normal” advertising campaigns – this now stands at 54%.
Obviously given the current climate, many brands are experiencing tight budgets right now and ad spend needs to be more strategic than ever. Understanding what matters to consumers and their changing behaviors is one way of doing this.
It’s important for brands to note the financial implications of COVID-19 for consumers. Globally, consumers who approve of brands running promotions right now have increased from 75% in March to 84% in July.
Again, New Zealand has the biggest increase here, jumping from 56% in March to 83% in May.
This has now stabilized at 76% in July, but it shows that even as nations begin to control the health implications of COVID-19, brands must continue to help their consumers financially in the immediate to long-term aftermath.
Just over 80% of consumers globally also approve of brands offering flexible payment terms, a figure that hasn’t wavered significantly since April.
6. Consumers are calling for more eco-friendly brands.
A positive trend that has emerged as a result of the pandemic is increased calls for sustainability.
Across 18 countries surveyed in our most recent wave of research in July, 72% of consumers said that the pandemic has increased the importance of companies behaving in more sustainable or eco-friendly ways.
This differs hugely by countries though, just 44% of consumers in Romania and 46% in the U.S. agree.
The COVID-19 story is far from over, but by drawing on data from 5 waves of research ranging from March to July, brands can get insight on consumers’ behaviors during the pandemic, make predictions going forward, and ultimately help inform their decision-making.
The pandemic has affected countries around the world to different extents, but by recognizing the trends – at both global and national levels – brands can be better equipped to understand their consumers now and as we continue to navigate the situation.
