Since the beginning of the year 2020, with the onset of the pandemic, the world economy has been affected by an economic crisis. We live in a volatile environment affected by covid-19 cases, new strains and vaccination campaigns.
In this context, consumer behavior is changing rapidly, and with it consumer habits. It is therefore of utmost importance to understand the relationships that consumers have established between their physical and financial well-being, their purchase intentions and the trends that have accelerated the pandemic.
The following is an analysis of consumer behavior over the last 18 months to determine the consumer outlook for 2022 and to understand their priorities, preferences and purchasing decisions.
Consumer concerns: financial and physical well-being
Economic recovery remains one of consumers’ biggest concerns. With just a few months to go before the end of the year, the countries with the most optimistic consumers about financial recovery over the next three years are South Africa, Norway and Denmark, with 74%, 50% and 47% respectively. In contrast, the Netherlands, Sweden and the United Kingdom are the countries most skeptical about the recovery with 39%, 41% and 43% respectively.
South Africa, the United Kingdom and the Netherlands are the countries most concerned about inflation with 86%, 70% and 62% respectively.
Inflation represents one of the biggest concerns for consumers. South Africa, the United Kingdom and the Netherlands are the countries most concerned about inflation with 86%, 70% and 62% respectively. In contrast, Denmark with 42%, Sweden with 44% and Norway with 47% are less alarmed.
Average spending per consumer will vary according to the purchasing power of each country. Thus, the percentage of the budget allocated to essential items is between 62% and 70%, while the budget dedicated to the consumption of sporadic products ranges between 30% and 37%. Of these, the United Kingdom is the country with the highest amount of money per consumer to spend on sporadic items and South Africa the lowest, with 37% and 30% respectively.
On average, 71% of consumers say they feel safe going to stores to make their purchases.
Normality is returning to normal and consumers are resuming their consumption habits. The safety of going to a retail outlet to make purchases varies according to the epidemiological situation in each country. While South Africa is the country where 46% of consumers are most concerned about going to physical stores, Norway is the country with the greatest peace of mind, with only 18% of consumers feeling unsafe.
Purchase intent by channel: reaffirmation of omnichannel
The healthcare crisis has led to an undeniable boom in the online channel. However, with the return to normality, purchase intent by channel has recovered pre-pandemic figures. According to Google, it is expected that 78% of purchases will still be made in traditional stores by 2024.
The intention to buy in physical stores is dominant in all categories. In the Home & Furniture, Food & Supermarkets, Household Goods and Pharmacies and Health sectors, they prevail with 66%, 80%, 77% and 80%, respectively.
The epidemiological situation accelerated the adoption of digital channels, and they will continue to be present in the consumer buying process. However, traditional stores remain the most relevant conversion points for consumers. The future of consumption is omnichannel, and considering these types of strategies will be fundamental to ensure your presence throughout the customer journey.
New emerging consumer profiles.
The context generated by the pandemic has led to the emergence of a set of consumer profiles that have been consolidating throughout this period. Although they are not mutually exclusive, three emerging consumer profiles are clearly discernible:
- The convenience seeker: is one who agrees to spend more for convenience. According to November 2021 data, 41% of consumers would agree with this statement.
- The bargain hunter: is the consumer who would buy any non-essential item if they could find a good deal or promotion. 44% of consumers identify with this statement.
- The socially conscious shopper: eco trends have been reinforced in recent years. 44% of consumers admit to buying more local products even if their cost is higher, and 42% admit to buying more products from those businesses that have managed to handle the crisis correctly.
The outlook for 2022 looks promising for the consumer industry. The gradual economic recovery will generate greater consumer confidence, which will gradually return to normality and consolidate consumer habits.