Few consumers plan to shop as soon as coronavirus lockdowns end
Just one in five consumers is likely to head straight for the shops as soon as their respective coronavirus lockdowns end, according to data released by finance services firm Jefferies.
The firm has published a round-up of key insights from several recent studies of markets in China, Hong Kong and Macau following the impact of Covid-19. The studies focused on how the pandemic may change consumer behaviour in the wake of the crisis.
Jefferies’ survey Armchair Economics: A Global Survey of Citizens At Home highlights that most people think the crisis has the potential to “shake things up” for the better and that more than six in 10 people think companies have acted responsibly during the pandemic. At the same time, most consumers are not planning to book holidays even next year (indicating challenging times ahead for airlines and the rest of the travel industry) or move house, and in the US roughly six in 10 people remain optimistic about the health of their finances.
“We believe this pandemic could redraw the political landscape as many societies have had to endure hardship for the common good,” said Jefferies’ global head of thematic research Simon Powell. “Moreover, most people think companies have acted responsibly, suggesting the societal shift towards stakeholder capitalism and corporate social responsibility is indeed sustainable.”
According to Consumers in a Pandemic: Asia Sector and Stock Implications, e-commerce is benefiting from the shift to online. In China, respondents reported buying as much as 80 per cent of consumer staples online, indicating online shopping will revive first, followed by food delivery and last local travel.
“In Asia, 45 per cent of respondents reported they were spending more time playing games,” noted Powell. “The survey results show strong demand across mobile and PC games, with Asia showing the strongest shift as more time is spent at home.
“Asian telcos have become even more important for every household and business as more time is spent at home.”
The Labour Holidays – An Opportunity for Boosting Domestic Consumption report on the Chinese market indicated the government is likely to encourage domestic consumption and tourism.
“This is the first holiday after the resumption of business,” said equity analyst Anne Ling. “Most of the consumption will be kept within China vs. in the past years, Chinese consumers tend to travel outside of China.”
A further report on China’s food retailer market, Food Retailers – Key Chains should Take Share Post Outbreak, showed food retailers continue to experience good same store sales trends for the year to date.
Data showed that customer behaviour has changed with a higher priority on cleanliness and safety and that consumers have become more familiar with shopping for groceries online. Restaurant recovery has not proved as fast, however, and some hypermarket operators such as Sun Art have increased their food and FMCG offerings since the outbreak.
“We had expected some pull back in March/April with the end of lock down in March and business resumption,” said Ling. “However, so far we believe leading chains will benefit from the whole outbreak.”