Consumers Shifting Shopping Habits

Roughly half of consumers (49%) have spent less money because of the pandemic, with 22% of this group stating they’ve made a significant decrease in spending, Blue Yonder found when it surveyed over 1,000 U.S. consumers between March 18-19, 2020, to uncover how COVID-19 and the current economic slowdown has impacted spending habits.

Of the respondents who are spending less overall, more than half (59%) are spending less on retail specifically because they are avoiding going out in public and cannot purchase things in-person. While the survey found 57% of consumers said they are doing more shopping online as opposed to in-store because of COVID-19, together this data seems to indicate the real strength that brick-and-mortar retail lends to discretionary spending.  

However, retailers who are digitally-focused still have an opportunity to engage with online shoppers and increase conversions. Retail Systems Research (RSR) found the majority of shoppers will either not shop in-store at all or will only do so if “absolutely necessary,” when it conducted a survey of nearly 1,200 shoppers. Ninety-three percent said they expect to shop online either more (60%) or at the same level (33%) as they did before the outbreak. Retailers should be aware, the top three things respondents felt would make shopping online more difficult during the crisis: unavailable inventory; no free shipping option; and a slow website.

“The results of our consumer survey clearly indicate that even at a time when the vast majority of U.S. inhabitants are not infected with coronavirus, their sense of responsibility to stop the unwitting spread of the disease is keeping them at home – causing their shopping behaviors to be drastically affected,” said Steve Rowen, managing partner, RSR. “With most experts predicting the effects of this outbreak to continue for several months, it can clearly be expected that the online shopping trends exposed in this research will only increase in the days and weeks to come. As a result, store-based retailers are in for a long and difficult journey.”

 Total U.S. CPG online sales jumped 41.7% for the one-week period ending 4/4/20 vs. the same week last year, according to Nielsen Total U.S. dollar sales data, with food jumping 79.8% and baby care down 5.7%. Total U.S. CPG in-store sales were up  15.8% for the one-week period. Interesting to note, lip cosmetics (-62.4%), sunscreen (60.3%), and footcare inserts and insoles (-59.3%) saw some of the largest declines, all likely due to more consumers staying indoors.