The first release of our multinational study into 13 global markets proved to us that the coronavirus outbreak is having an unprecedented impact on the consumer landscape.
But as lockdowns and restrictions begin to ease a little in many countries, how is the situation evolving? Are they growing more optimistic and confident? Are they starting to plan for a return to normality? Have they been making plans for those purchases they delayed, those vacations they didn’t book, or those other day-to-day behaviors that they had to put on hold?
While the first and second releases of our international study showed the scale of the impact, this third wave looks towards the post-outbreak future.
Fielded in 17 countries between April 22 – 27, the research shows us how the picture is evolving as some countries hope to enter the recovery phase.
Analyzing the impact across Australia, Brazil, Canada, China, France, Germany, India, Ireland, Italy, Japan, New Zealand, the Philippines, South Africa, Singapore, Spain, the UK and the U.S., this study also provides an updated view on many of the themes covered previously.
As with all of our dedicated research on this topic, the data and reports are free for everyone to access. Here we’ve summarized ten crucial insights from the research.
You can download the full report for more detail or analyze the data for yourself in our platform.
Many consumers are planning (very) slow returns to public places.
As “lockdown” or “shelter-at-home” restrictions begin to ease, we won’t see an immediate return to normality.
Almost half say they won’t be visiting shops “for some time” or “for a long time”; this rises to nearly 60% for large outdoor venues (e.g. sports stadiums, music festivals) and climbs still higher to two thirds for large indoor venues (e.g. cinemas, concert halls, sports arenas).
As we see in other results in this study, concerns about safety are a key driver here – across a range of questions, future behaviors center around minimizing personal risk.
In some cases people plan to achieve that by spending less time in public places, while in others it is through more usage of things like home delivery, digital communication, and staying in the local area rather than venturing further afield.
The anticipated length of the outbreak continues to increase – and rapidly.
Between waves 2 (early-April) and 3 (mid-April), the number of people expecting the outbreak to last six months or more in their country has increased in almost all markets.
Some of the rises have been particularly dramatic, as in Germany (49% to 71%), Italy (28% to 57%), and Spain (23% to 52%). With all of these countries having been hit early, it suggests consumers are now coming to realize it will take longer than they first expected to recover.
The same pattern is present even in China; although it remains the most optimistic country across all relevant measures, the substantial increase in the numbers expecting it to last 6 months+ (from 12% to 26% over a period of just two weeks) is testament to how quickly sentiment can worsen if new cases continue to be confirmed.
In virtually every country, people remain much more pessimistic about the global situation than their own national one.
And there’s a clear correlation with a country’s perceived success in tackling its own outbreak; by some distance, it’s China and then New Zealand which see the biggest gaps. The latter’s recent announcement that it has effectively eliminated the spread of transmission is likely to be a big driver here.
With a majority cutting back on daily spending and delaying big purchases, the appeal of promotions is strong.
When we ask consumers how they plan to respond to the outbreak financially, about 8 in 10 plan to delay big purchases, while just over 4 in 10 say they will cut back on the day-to-day things they buy.
Around a third will be using their savings, reducing their regular financial commitments (e.g. subscriptions), or waiting for products to be on promotion or sale.
The appeal of promotions and discounts emerges in several places across wave 3 of our research. For example, those who have delayed purchasing a technology device are twice as likely to say they will wait for it to be on offer as they are to look for cheaper options from the same brand. They are also almost four times more likely to hold out for promotions rather than looking for cheaper options from an alternative brand.
It’s a similar story with luxury items (e.g. designer clothes, shoes, fragrances). Those who have delayed such a purchase are more likely to wait for a promotion than take any of the other actions we asked about. This suggests a clear opportunity to galvanize loyalty and encourage spending through the use of offers.
Numbers delaying purchases continue to rise.
In most categories, the numbers who say they have delayed a purchase have risen since wave 2. This is especially evident with clothing, home appliances, luxury items, and vacations.
The delay to clothing purchases is led by Gen Z (over 4 in 10). This group is also the most likely to have delayed buying a smartphone (33%), a smart device (21%), or a personal electronic device (33%).
For many other categories, it’s millennials who are most likely delay – including flights, vacations, luxury items, home furnishings, and home appliances.
There are strong income-based trends in evidence here. The lower income group is most likely to have delayed purchases of clothing, insurance, and technology devices, whereas the higher income group is notably ahead for delayed automotive, travel, luxury and domestic purchases.
The delay to purchasing luxury items has grown consistently in China, from 20% in mid-March, to 24% in early April, to 31% in mid-April. Nevertheless, an opportunity is presenting itself here: luxury buyers are particularly receptive to promotions as a way to kick-start spending, and China also sees the highest levels of optimism of any country in terms of feeling that it is in the recovery stage.
Vacations are the top priority for post-outbreak purchasing, but the market could look very different.
Almost a quarter say that vacations will be their top post-outbreak purchase priority, rising to almost a third among the most affluent group.
There’s an age-pattern at work too; the older the consumer, the more likely they are to prioritize booking a vacation (with boomers scoring 29%, vs. 18% for Gen Z – the latter being most focused on clothing at 25% and smartphones at 20%).
When asked what would give them confidence to travel again, a personal feeling of safety is by far the top option – scoring 58% globally and peaking at almost 70% in markets like the U.S. and Ireland. Safety is also paramount for boomers, where 65% select it.
Significantly, only around 20% say they don’t plan to make any changes to their vacation behaviors.
The most popular option at the moment is to have more local trips, followed closely by taking more domestic vacations. This reflects a combination of two factors: the feeling that one’s own country is outperforming the global average, together with the importance of safety in terms of vacations.
Half of consumers support “normal” advertising – but there’s a need to tread carefully.
From a list of 11 possible actions that brands could be taking at the moment, running “normal” advertising which is unrelated to coronavirus scores the lowest approval rating.
Nevertheless, it’s still 52% globally who approve of this, with the figure passing 60% in Brazil, India, Italy, and Spain. In no country do we see approval dip below 40%.
Topping the list of brand actions are the provision of practical information / tips to help people deal with the situation (83%) and pledging money / aid / supplies (83%). That’s followed by two more financially oriented activities: running promotions (81%) and offering flexible payment terms (80%).
Most options tracked in multiple waves have either seen no real change to their global figures, or a slight decrease. The obvious exception to this is running promotions, which is up by 6 points – suggesting that many people are preparing to start purchasing again, and are looking for financial support from brands.
Promotions have an appeal which transcends the age, income and gender breaks although, interestingly, the higher income group is 5 points ahead of the lower income one. Clearly, the appeal of value-for-money in the post-covid landscape will be widespread.
Online shopping should see a long-term boost – and free, reliable delivery is highly valued.
Over 40% say they will shop online more frequently after the outbreak, hitting 50% in China. Some countries such as Japan and France are notably less enthusiastic about this, but the global figures remain high and consistent by gender, income, and age (only dropping a little among boomers).
For those planning to increase their online shopping, home delivery is around twice as popular as in-store collection.
Convenience will be a big driver to this, but as we’ve seen elsewhere, safety is paramount too: significant minorities want to reduce the time they spend inside stores as well as visit stores less frequently.
Compared to before the outbreak, free delivery (51%) and reliable delivery (51%) are the things people think have become more important to them. The figures for free delivery are remarkably consistent across the major demographic splits, whereas reliable delivery matters more to Gen Z, millennials and the higher income group.
A wide range of categories can be expected to benefit from this increase in online shopping. Across the 17 markets, around 3 in 10 say they plan to shop online more for groceries, household essentials and personal care products. Nevertheless, clothing could also benefit significantly (29%), as could cosmetics, personal electronics, and smartphones (all scoring over 20%).
In many of the categories tracked, figures peak in China – suggesting that a country which was already at the vanguard of online shopping will see yet more momentum here.
Consumers expect to reduce their out-of-home leisure behaviors.
Across the 17 markets surveyed, 2 in 3 consumers say they expect to reduce how frequently they engage with various out-of-home leisure activities.
Going to restaurants is at the top of the list for a reduction; over 40% anticipate they will eat out at restaurants less frequently. It’s a figure which remains consistent by age, gender and income, but which does peak among Gen Z at closer to 50%.
About a third think they will eat at fast-food outlets, visit bars, pubs or visit the cinema less often.
Most of these behaviors are once again led by Gen Z. And it’s no coincidence that this generation also expect the biggest impact on their personal finances, and hence why promotions, value for money and reassurance over spending being worthwhile appeals strongly here.
With over 40% saying they plan to exercise at home more frequently after the outbreak, we have some context for why 1 in 10 say they expect to cancel a gym membership.
Convenient solutions popularized or highlighted during the outbreak can expect lasting gains.
Many of the tools and solutions that people have turned to during the “lockdown” period can expect a lasting boost. About a fifth say they will use food delivery services more frequently, around a quarter plan to use video conferencing platforms such as Zoom more regularly, and about a third plan greater usage of mobile payment services and video calling tools such as FaceTime.
As might be expected, there are strong demographic influencers at work.
Gen Z are over three times as likely as boomers to plan higher usage of food delivery services.
Similar age patterns are present for mobile payment services, video calling and video conferencing. The higher income group also tends to take a lead over the lower income one, especially for using video conferencing.
With many companies having to move to full remote working during the outbreak, it’s clear that employees will expect more convenient and flexible options once normality resumes. It’s close to 1 in 4 who say they expect to work from home more frequently, peaking among Gen Z and the higher income group.
Learning platforms can also be expected to have a more visible presence in the future. Globally, around a third say they are spending more time on them during the outbreak, but this rises to over 50% among Gen Z. And, crucially, over a fifth of this youngest cohort expect to continue this after the crisis is over.
Initial diversification of media consumption appears to be slowing.
In wave 1, we saw a wide range of media and in-home activities benefiting as people looked for ways to fill their time during “lockdown”. In wave 2 in early April, there were small decreases evident for many of them, suggesting that initial enthusiasm was being replaced by a sense of fatigue among at least some consumers.
This pattern has continued in wave 3 in mid-April, with almost all of the 20 tracked activities seeing another small decline.
In some cases, this will be the result of countries beginning to ease “lockdown” restrictions; there simply aren’t as many people still confined to their homes, and so there isn’t as much additional time to spend on media activities.
But especially among younger groups, we’re also seeing evidence of people focusing on activities that were already popular among their demographic.
If we look at Gen Z as an example, some of the strongest figures come for things like social media, messaging services, videos, and streaming services. In each case, over 50% say they are spending more time on them, and around a quarter or more say they expect to continue this increased level of consumption after the outbreak. Effectively, the initial diversification is giving way to a more concentrated focus on key activities.