News about the surge in cases of the delta variant of the COVID-19 virus is starting to take a big bite out of consumer confidence, according to a recent survey.
At First Insight, we have been tracking consumer purchase behavior and spending data in a longitudinal study that began in February 2020, at the beginning of the pandemic. We have continued to conduct our poll, finding as recently as last month that confidence had been buoyed by the diminishing number of cases, rollback of mask and other mandates, and resumption of in-person activities. We hoped we were finished with the survey as spending habits seemed to be returning to pre-pandemic behavior.
Not so fast, consumers are telling us.
In just a few weeks we recorded a 25 percent spike in the number of respondents who admitted to being “very or somewhat worried” about the virus. That is the biggest one-month jump since March, 2020, just as the shutdown began.
This month (August), more than half (56 percent) said they would be cutting back on spending, an increase of 8 percent over the responses given just a month earlier.
An even more worrisome finding is that one in four of those surveyed reported that they were not vaccinated, and nearly all of the unvaccinated (90 percent) said that mandates within restaurants and other gathering places would not induce them to get the shots.
As the back-to-school shopping season begins, we find low vaccination rates among Millennials, and in women, which could hamper back-to-school sales. Overall, the majority of those surveyed (61 percent) had already been vaccinated.
Safety concerns around in-store shopping have begun to increase after the lows we recorded in July.
Working with sales associates, trying on clothing, trying on shoes, and testing beauty products and makeup have all seen significant increases in the number of consumers wary of these activities.
The resurgence in cases continues to negatively impact decisions about going out, whether it’s to the mall, to restaurants, or traveling. Nearly half (44 percent) of respondents said that they have cancelled trips because of the recent COVID-19 news. These factors should, however, fuel a continuation of ecommerce’s higher-than-usual penetration of overall retail sales.
It remains to be seen how long the delta variant will be troublesome, but clearly we are not out of the woods. Our survey suggests we will be living with COVID-19 and its variants for the foreseeable future, despite the wide availability of vaccinations. Retailers, restaurants, and the travel industry should plan for a future in which COVID disruptions remain the norm.