Lock-downs have changed our priorities and the way we live, socialize, buy, and obtain information. There is a drop-off in brick-and-mortar shopping that affected some industries but benefited others. According to J.P. Morgan, in 2020, COVID–19 transformed our spending habits: Consumers are now shopping online everything “from hand sanitizer and groceries to skincare products and cleaning supplies.” Families had to invest in the new “necessity goods,” e.g., subscriptions to Netflix, Amazon Prime, and Disney+.
GlobalWebIndex.com informed that 80% of American consumers rely more on digital content after the COVID-19 pandemic started.
I myself depleted Publix from Windex Antibacterial, hydrating drinks, and toilet paper through Publix’s App; hoarded masks, gloves, and paper towels from Amazon; and of course, made Nintendo rich by buying games to keep my bored daughter, and I, mentally sane.
Paul Marsden, a consumer psychologist, explained to CNBC that panic buying is influenced by three fundamental psychology needs: autonomy (or the need to feel in control of your actions), relatedness (the need to feel that we are doing something to benefit our families), and competence (the need to feel like smart shoppers making the correct choice).”
Now that the restaurants were allowed to open, we still like to order deliveries through the Uber Eats App. I have a particular weakness for supporting local mom-and-pop’s food businesses that populate Instagram. This digital consumption trend is here to stay, at least for some industries.
So far, shelf-stable products like dried fruits, beans, grains, or milk substitutes (oat, rice, or soy milk) are up by more than 300% in dollar growth; however, some industries are on the brink of bankruptcy. Bigcommerce.com affirms that omnichannel sellers are reporting significant losses. People are shopping less in person: “Department stores like Macy’s and JCPenney, large chains like Abercrombie & Fitch and Nike, and DTC brands with some storefronts are closing their physical stores.”
Celine Pannuti, Head of Research at J.P. Morgan, confirms that cosmetics and sun-care products’ sales have fallen since people are not traveling or working as much as before.
Nielsen clarifies that the spending habits depend on the financial situation of the consumer: “Those whose incomes have been negatively impacted by COVID-19 will spend to survive, compared with insulated spenders, who may adjust situationally even though their incomes remain unchanged by the pandemic.” To Nielsen, there is no guarantee that companies selling more now will keep the same income rate forever.
Regardless of the type of device we may be using to keep in touch with the world, every generation is trusting social media more than ever. Marketers and companies who adapt quickly will be better prepared to make decisions to resolve the consequences. “Unlike the Great Recession, there are tools and metrics available today that can be leveraged immediately. The implication for brands trying to meet the new needs of consumers is that they must be very focused and very fast in their response”, Nielsen remarks.
And what about you? What’s your favorite way to interact with the world during the pandemic? If you would like to share any experience on this matter, please let me know. I’m here to listen.
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