There is little doubt that the very profile of the global customer base has changed post pandemic. This seems true regardless of the sector but with the exception of a few countries, this is true globally. Customers have been shaken for sure, but they have proven to be resilient in the wake of COVID. However in the US, the retail economy seems to have returned to similar levels this time last year. The US retail market lost in excess of $100 billion during the pandemic induced lockdown. This is according to the US Census Advance Monthly Retail Trade.
Customer Choice
Customers’ choices seem to have evolved and this has been noticed with the recent activities of many eCommerce stores. Discretionary spending has still not reached pre-COVID levels, however they are steadily on the increase. The economic conditions have seen zero-based budgeting by households which are spending more on essentials. So much so that according to BizRate, only 17% of people say shopping is the activity they miss the most since lockdown. 37% of males and 32% of females cite apparel is the thing they have delayed purchasing due to the pandemic. This is followed by home furniture products then health and beauty products. Even back to school and holiday spending in 2020 will almost certainly not be as much as previous years. Almost half of those surveyed indicated that they will actually be spending less. Those on lower income are going to be more thrifty but the trend is similar among those with higher income.
Change from initial trend
After initial hoarding of items ranging from canned food to hygiene products, there was a noticeable fall in spending after lockdown. Affinity Solution credit card transaction data, found wealthier american households cutting discretionary spending and spending in general more. Those making in excess of $100k have cut spending by 23% while those on less than $50k have cut it by 19%. Omnichannel has soared since March, hitting levels we expect during the holiday season. So far, as the lockdown eases and more stores open, online sales continue their steady growth. This might be because according to BizRate almost 40% of people feel more positive about online shopping since COVID. This has caused some noticeable new shopping habits with more that 40% trying curbside pick up for the first time. About a third of people admitted to trying new brands for the first time which gave growth opportunities to many businesses.