8 out of 10 customers say they will cut spending after the pandemic ends

Report: 8 out of 10 customers say they will cut spending after the pandemic ends

Our lives will soon return to normal. The open question is what that normality means after such a long period of isolation. As the latest research from Chicago-based research agency Harris Poll shows, 8 out of 10 respondents say that despite the end of the pandemic, they will continue to save and spend less. Interestingly, many also plan to continue digital grocery shopping and move to less urbanized areas.

There are many signs that the ending global lockdown may have caused a permanent change in consumer behaviour.

- “While long-term forecasts in the face of a crisis may seem like reading tea leaves, marketers already need to take into account consumers' current feelings and aspirations in order to determine which behaviours may become the new norm and how to adapt to them in terms of communication.” - advises Grzegorz Kosiński, president of Audience Network, a company belonging to Cloud Technologies that specializes in data consulting and helps companies communicate effectively in online advertising.

The new norm

The new norm

The American consulting firm based in Chicago - Harris Poll - has just published the results of the “COVID-19 Wave 8” study. According to data from the April 2020 survey, the largest share of respondents said they would continue to save and spend less after the coronavirus pandemic ends (79%).

- “This is not the best news for businesses, which today need a rapid inflow of capital. However, it is not only how much we will spend that is changing, but also how and where we will spend money. Those most exposed to the greatest losses are traditional retailers. This may be an especially painful period for them, unless they move their operations online. By following their customer, they minimize the risk of losing liquidity.” - advises Grzegorz Kosiński of Audience Network.

The thesis put forward by Kosiński is confirmed by the results of Harris's research. According to them, as many as 43% of respondents say they will still do their grocery shopping online, even though the threat is theoretically coming to an end. As if that were not enough, as many as one in three people are considering moving to areas with lower population density, which is linked to the need for social distancing.

- “Global corporations are already responding to this trend. Take, for example, the Lidl brand, which launched the possibility of shopping in the BOPIS model in Poland, that is Buy Online, Pick-up In Store.” - notes the Audience Network expert.

Why will customers cut spending after the pandemic?

Transport will certainly also suffer, both land and air. Respondents in the study said they would significantly limit their travel, restricting themselves only to essential trips - 68%. That is not all, however. Nearly 6 out of 10 respondents declared that when going on a longer trip they would give up flying in favour of their own car.

Business ready for change

Business ready for change

The results of the research conducted by Harris Poll are not the first analysis of this kind to suggest a change in shopping habits. More and more independent entities are warning that the experiment called lockdown has turned out to have a significant impact on consumer habits. Experts from Accenture have long been suggesting a change in consumer habits that is already forcing a modification of business strategy. The opinion has become widespread that the coronavirus has encouraged a large portion of consumers to abandon the traditional model of shopping in favour of online commerce. Accenture warns that: - Those who viewed digital commerce as a secondary channel must now change the priorities of their operations, focusing on digital commerce.

It is therefore no surprise that, according to Pymnts.com data from May 2020, 66.4% of small and medium-sized business owners in the US said that after the coronavirus pandemic they would rely more on e-commerce. What exactly does this mean for entrepreneurs? - Transformation is more than setting up a website or a social media profile. It is a change in the entire model of how an organization communicates with its environment. - notes Marcin Filipowicz, vice-president of Audience Network, and adds: - Although the beginnings can be difficult, for a company it is an excellent opportunity to set sail for broader waters. The choice between offline and online is an unnecessary compromise today. Let us act in both directions, and let both channels of business interaction with the audience support each other, offering the customer a complete range of experiences. - concludes the expert.

A strong online presence will soon be essential for small and medium-sized companies, especially those whose sales have so far been based solely on the traditional sales model, where the success of the venture was decided by customers walking in from the street. By using digital technology, small and medium-sized companies can expand their customer base, remain visible and benefit from existing relationships.

Summary

The Harris Poll research shows that 79% of consumers plan to save after the pandemic, and 43% will maintain digital grocery shopping. Experts, including Grzegorz Kosiński of Audience Network, point to the need for digital transformation of traditional retailers, an example of which is Lidl's implementation of the BOPIS model. Meanwhile, Marcin Filipowicz emphasizes that e-commerce is not just a website, but a change in the company's entire communication.

An interesting fact is that, according to Pymnts.com data from May 2020, as many as 66.4% of small and medium-sized companies in the US plan to rely more on e-commerce after the crisis, which confirms the durability of the trend.