What a Difference a Week Makes – Tracking the Effects of Coronavirus (COVID-19)

A study conducted by Sales Factory during the early months of the COVID-19 pandemic demonstrates just how quickly consumer attitudes and sentiment can change.  In just one week, the level of concern over coronavirus increased substantially, which greatly impacted how consumers shopped and spent over the remainder of the year. Sales Factory fielded a national benchmark survey on March 6, 2020, with a follow-up wave fielded on March 13. Nearly 1,600 consumers participated in the surveys.

“In just one week, the huge swings – both down and up – in the stock market, the implementation of international travel bans, the postponement or cancellation of major sporting events and leagues, and the declaration of a national state of emergency all came together to significantly change consumers’ attitudes toward the disease and the economy,” said Ged King, chief executive officer for Sales Factory. “We’re seeing positive changes in the acceptance of social distancing. We are also seeing an increase in people that might delay a major purchase, but still expect to complete them in the next 12 months. The bright spot is e-commerce. Barring distribution challenges, it is an opportunity for brands to help consumers.”

Highlights of the report include the following:  

  • The level of concern over coronavirus increased sharply as more people reported that they had been impacted by the virus.
  • When coronavirus dominated the news, there was a 25% increase in familiarity (from 64% to 80%) over the course of a week. The increased familiarity with the virus appeared to fuel concerns about its impact.
  • The percent of people who reported being impacted by coronavirus more than doubled between surveys, with 37% reporting that they have been impacted compared to 16% the previous week. 
  • In the first survey week, 49% were concerned about the coronavirus impacting their life in the coming year. This figure rose to 63% in just one week.
  • 43% believe their household income will be negatively impacted by coronavirus, compared to 26% the previous week – an increase of 70%.

COVID-19 delayed purchases. 

Coronavirus also disrupted consumers’ willingness to make major purchases, which had ramifications at retail. The events that unfolded tempered consumers’ willingness to commit to major expenses during this time period, demonstrated by a substantial decrease in the number of consumers who said they planned to proceed with major home and auto purchases that year.

  • Among those planning to buy a new home in 2020, 41% said they would proceed as planned – down from 67% in the benchmark survey.  This decrease was led by Millennials, whose intent to proceed with a new home purchase as planned declined to 35% from 73%.
  • Planned spending on major home improvement purchases decreased to 35% from 49%, with boomers declining to 22% from 54%.
  • New home furnishings purchases decreased to 35% from 51%, with the steepest decline coming from Gen Xers, which decreased to 36% from 61%.
  • Among those who planned to buy a car in 2020, 36% reported they would likely proceed as planned, down from 49% in the initial survey. Boomers again led the decline, dropping to 23% from 55% from one week to the next.

Amazon-Ecommerce-Manager-Sales-Factory-Orange (2)

Coronavirus fueled online shopping.

As additional retailers announced store closures of two weeks or more in March of 2020, consumers grew more concerned about their ability to get the basic household items that would carry them through a protracted quarantine.  As a result, more consumers turned to online shopping to meet their needs.

  • 58% were concerned about the potential availability of basic household items (e.g., food, water, paper products, personal hygiene products) resulting from coronavirus, up from 41% from the previous survey week. 
  • 56% of consumers said they would shop online more because of coronavirus, up from 47% from one week to the next – an increase of 20%.

Online Shopping - SF Brand Image - Bright Green-1

Consumers were concerned about outbreaks.

Consumers believed an outbreak was coming, but didn’t believe employers would be ready for it.

The study found that 71% of consumers were confident that taking extra steps to protect themselves (e.g., avoiding crowds, washing hands more frequently) would minimize the likelihood that they would get coronavirus. This figure was an improvement from the 64% reported in the previous week. While confident in their own ability to protect themselves, there were concerns about the population at large.

  • 60% of consumers believed it was likely that there would be a major outbreak of coronavirus in the U.S., up from the 50% reported in the previous week.
  • However, only 37% said that their employer had a plan for a coronavirus outbreak, compared to 25% reported in the previous week.

Download the Report