A decline in luxury spending and a shift away from cash payments are among the behaviors taking root as COVID-19 spreads – and ones which may have longer-term staying power.
Rosie Hawkins, chief offer and innovative officer/insights at Kantar, the global research firm, discussed this subject on a recent webinar held by the company.
Based on Kantar data from China – the market that was hit earliest by the coronavirus – she reported that 61% of consumers have reduced or eradicated their luxury spend, and 21% plan to carry on doing so once the recovery starts.
As a result, the industry that is “probably most likely to be affected out of this seems to be the luxury sector,” she said. (For more, read WARC’s in-depth report: Which new behaviors will stick after the COVID-19 crisis ends?)
When the recovery begins, the Chinese data suggests, certain other COVID-influenced behaviors will stay robust, as consumers remain wary following the crisis.
Shoppers, for instance, will continue above-average expenditure in categories like disease prevention (such as masks and hand sanitizer), pandemic prevention (e.g. air purifiers), health food (say, vitamins), and medicine (like cold prevention products).
Other enduring behaviors could include paying closer attention to the sterilisation and disinfection effects of personal care and household cleaning products, wearing masks as a daily habit, and buying appliances that facilitate disinfection.
Another trend emerging from Kantar’s research – and stemming in no small part from a growth in e-commerce as consumers spend more time at home – is an inevitable decline in cash payments.
“One of the things that we’re seeing is people very swiftly moving away from cash, and using debit using credit, using mobile payments, possibly for the first time and using mobile banking, possibly for the first time,” Hawkins said.
“We’re only seeing small changes in those behaviors at the moment, but it was interesting just how quickly behavior moves away from cash. And we do expect that, as I say, to stick.”
Sourced from WARC