Consumer Reaction to the Current Pandemic

Deloitte recently conducted an in-depth consumer survey, described in this overview:

“As a global health crisis potentially morphs into an economic one, Deloitte is conducting a series of biweekly surveys around the globe to better understand the interplay between personal safety and economic vulnerability as a driver of purchase decisions and consumer behavior. The first such survey titled “Deloitte Global State of the Consumer Tracker,” conducted in 13 countries during the week of April 13, 2020, queried 1,000 consumers in each country. The responses provide insight into how consumers in different countries intend to weather this dual crisis.”

Some of the key takeaways from this survey are listed below. As we all know, this pandemic has caused an unsettled time for our consumers, so a better understanding of what motivates them can be helpful as we plan for our New Normal.

MERCHANDISING TIP OF THE WEEK. Here are the key takeaways from the Deloitte April 29, 2020 multi-nation survey:

Health concerns generally exceed financial concerns in the U.S., with more than 50% of respondents concerned about health and nearly one-quarter of respondents worried about finances.

Only one-third of U.S. consumers (34%) feel safe going to the store right now.

Consumers in India and Japan show a bigger anxiety spike than the U.S.

Millennials lead the online shopping charge in the U.S., predominantly with in-store categories such as groceries, everyday household goods, and alcohol.

Global angst remains elevated when it comes to personal well-being and finances:

Health concerns are highest in China and India, the world’s two most populous countries: 89% of Chinese consumers and 79% of Indian consumers are concerned for their family’s health.

Concern in the U.S. remains elevated: 64% are worried about the health of others; 52% about their own health.

On average, across all countries, 42% of respondents who still had a job were concerned about losing their jobs. In the U.S., 35% of respondents are concerned about losing their job.

Respondents in Spain and India were also the most concerned about making upcoming payments. Among Americans younger than 55, one-third were concerned about making upcoming payments.

Forty-two percent of U.S. consumers are delaying large purchases.

There is a shift in discretionary spending. From the survey: “Facing a great deal of economic uncertainty, a majority of consumers in most countries intend to curb their discretionary spending, and they may eventually look for ways to cut even their less discretionary spend to make ends meet. In fact, the survey notes that in many countries, most consumers’ net spending intent is to curb their discretionary spend over the next four weeks.”

Americans will generally spend less on discretionary items like travel, eating out, and automotive fuel, but 47% would buy a non-essential item if they found a great deal.

U.S. consumers plan to spend more on necessities such as groceries, household goods, and utilities; 55% of U.S. consumers report stockpiling.

Nearly half of U.S. consumers (48%) will pay more for convenience to get what they need.

Other key findings: Despite the rapid rise of online grocery orders, online grocery remains a fraction of in-store spending intention in the U.S. Only 19% of respondents plan on purchasing groceries online in the next four weeks. This may be tempered by available supply of delivery slots versus demand.

With regard to digital consumption:

-Sixty-two percent of Americans plan to continue streaming entertainment content over the next four weeks.

-Fifty-three percent of Americans plan to continue video conferencing with family and friends.

Half of U.S. consumers are sticking with the name brands they trust.

Eighty-three percent of Americans plan to “buy online pickup in store” (BOPIS) in the next four weeks.

It is obvious that consumers have many concerns as they enter the next few weeks. What used to be a simple trip to the store is no longer “simple” – the need for that trip now must be tempered by the concern for health risks. Other purchases must fit into a budget that has, many times, been impacted by furloughs and even terminations. Knowing what motivates a consumer is powerful information for our future. Happy Selling!