70% of consumers prefer to buy a national product, even if it is more expensive for COVID-19
36% prefer to buy online as a result of the pandemic; 52% prefer local commerce and only 12% prefer to go to a shopping center or department store
Pablo Contreras, professor at EAE Business School, has prepared the second wave of the study “The impact of the coronavirus on moods, habits and consumption”, which collects data from an online survey of 1,000 people from all over Spain between 5 and May 12. The study shows that 70% of the respondents are inclined to buy products of national manufacture although they are more expensive due to COVID-19. Women, older people and respondents with children are the most likely to do so according to the survey.
However, 76.3% of those surveyed anticipate a decrease in their general level of spending. “This percentage is 10 points higher than those who think that their income will decrease, which points to greater general prudence in consumption even though it does not affect income as much,” says Contreras, author of the study. “This data contrasts with the one previously pointed out about a preference for the national product although it is more expensive, which suggests a qualitative reorientation of household spending with criteria that are both rational and committed to economic recovery,” explains the professor.
Likewise, there is a slight reduction in the number of people who state that their economic capacity will decrease between the first wave of the study (69.6%) and the second wave (66.2%). “This may be due to the fact that there is a somewhat less uncertain scenario in this phase with the start of de-escalation these days than there was in March during the first days of confinement,” adds Professor Contreras. In fact, the feeling of uncertainty, which stood at 64% in March, has slightly decreased to 61.5% of respondents.
However, the difference between the percentage of people who would reduce their consumption and their economic capacity stands out: in March it was 5.5 points and, in May, this difference has risen to 10.1 points, almost double. “This points to an even higher level of prudence and selectivity in spending in May than in March,” says the study’s author.
74.2% of respondents say that their budget for leisure activities will be reduced, and in 37.3% of cases it will drop “a lot”. Also noteworthy is the drop in the budget for eating out of the home, which is expected by 78.6% of the people asked.
Similar fate runs the shows, whose budget will be reduced in 73.1% of cases; 35.1% of those surveyed affirm that their budget for this will “go down a lot”. Another of the items that will be most affected by the cuts is the purchase of luxury products or Premium products, with a reduction by 81.6% of those surveyed (55% will drop a lot).
Regarding spending for the upcoming summer vacation, 70% of respondents will reduce their budget; Of these, 24% simply will not take vacations and another 24% will change international tourism for national tourism (16.5% of the total of respondents).
On the other hand, although it will also suffer some cut, the budget for healthy eating will decrease to a lesser extent, going from 32.1% to 29%. This is an indication of the importance attached to this category.
POST-CONFINEMENT PURCHASING PREFERENCES
The mode of purchase has also changed due to the Covid-19, and some changes will be maintained during post-confinement.
From the surveys carried out, it is extracted that 19.3% will avoid entering stores for fear of contagion, while 68.2% see no problem in this. 81% of respondents do not inconvenience stores to accept returns, although 10.3% disagree with this practice. 28.2% say they will not try on clothes for fear of contagion, compared to 48.1% who will. 58.7% affirm that they will feel safe knowing that clothes will be disinfected in the store, as opposed to 18.1%.
Regarding costume jewelry, 39.4% do not consider it correct to allow themselves to be tested and 32.8% do consider it appropriate. 50.4% consider it correct that stores do not accept cash payment, while 35.6% do not consider it correct.
52% of people would prefer to shop at local stores; 36% prefer to buy online and only 12% in a large area or shopping center. Those under 36 years of age show a very clear predisposition to buy online, well above the average. Those over 46 years of age show a clear predisposition to local trade. The preference for large retail formats is generally low, and somewhat higher than the average for young and old.
70.2% of the people surveyed affirm that, in general, they carry their confinement quite well or very well. However, the study also points out that uncertainty continues to be the sentiment that prevails in 62% of respondents; two months ago it was at 64%, indicating a network very small reduction.
44% feel encouraged compared to 48% in March, a decrease of 4 points or 5% compared to the first wave. It is striking that fear has dropped from 26.5% in March to 21% of cases in May. The feeling of sadness has dropped further, from 17.5% in March to 11.4% in May. The feeling of insecurity has gone from 27.4% to 21%. “The” experience “accumulated by people, adaptation to the situation, the prospects offered by the de-escalation and the greater proximity to a certain normality help explain this evolution,” says Pablo Contreras.
FORECAST AND OUTLOOK FOR THE FUTURE
In relation to the particular forecasts of the respondents, on when they consider that it will return to a situation of relative “normality”, 28.5% of people think that it will be throughout 2020, although 60% think that it will not be until 2021, even 35% postponed this return to normal after March 2021. 11% do not know what to answer.
The recovery of the economy until returning to the situation prior to Covid-19 is estimated in 2022 according to 34.7% of the respondents; 12% think it will be in 2021 and 41% think it will be after 2022.
Asked the respondents about the perspectives of their sector in particular, the most optimistic are those of the manufacturing of food products, health / pharmaceutical, technology, information technology, telecommunications and education. The most pessimistic about the future of their sector are professionals from the world of construction, real estate, catering, tourism and travel.
BUSINESSES AND THEIR RESPONSE TO COVID-19
When evaluating the role of companies in this crisis, 63% of respondents say that they will take into account the performance of companies in their future purchasing decisions, a figure that falls from the 72% recorded in the March survey. Also, companies that “take advantage” of the crisis to earn more money will have the rejection of 75% of respondents.
And one aspect that generally raises growing disagreement is the massive adjustments to the workforce as a consequence of the pandemic: in March, 58% of the people asked valued it this way; this figure has risen to 63% in May.