COVID-19 has brought out some new sides of people – new talents, from baking skills (or lack of maybe), to new fitness regimes. When we think about spending, it’s likely our behaviors have shifted since the pandemic hit. For me personally, the wallet closed like a clam; to open you’d need to literally pry it apart with all your muscle and might for anything non-essential. This new behavior isn’t unique, according to EY’s Future Consumer Index, the pandemic created new consumer spending segments.
EY asked consumers what they believe they will do once the crisis is over and few consumers expect to go back to their old behaviors. Will my clam wallet pry itself open for non-essential purposes? Unsure on that one. However, what this survey revealed is five new segments to emerge once the COVID-19 crisis subsides:
- Get to the normal (31%): Spending largely unchanged, not overly concerned about the pandemic.
- Cautiously extravagant (25%): Focused on health, optimistic but strongly believe a recession is coming – will spend on the areas deemed important to them.
- Stay Frugal (22%): Will spend less with some areas taking a deep cut. This segment is most pessimistic about the future.
- Keep cutting (13%): This group is least likely to be working and is making deep cuts, the pandemic always was and will continue to be a huge worry.
- Back with a bang (9%): This is a young and in-work segment. Spending across all categories, their daily lives were most disrupted, but they’re now the most optimistic.
While the pandemic has evolved over time, and we don’t know the end date, the good news for brands, retailers and marketers is that a lot of these new segments plan to spend. For advice around retail today and retail tomorrow, visit our Retail HOTline for more insights.
Daily life for people around the world has changed in ways that would have been unthinkable a few weeks ago. But as consumer-facing organizations try to find their way through the COVID-19 pandemic, it’s important to keep in mind that the global consumer was already evolving at great speed. That process is now playing out faster than anyone imagined.