At least half of American adults intend to spend less than they usually do during these unprecedented times and the fashion/clothing and homewares/furniture sectors can expect to be hit hardest of all, a new survey has revealed.
According to research and insights agency Opinium, 28% of more than 2,000 US adults surveyed between March 20th and 25th plan to spend “much less” than usual, compared to just 13% in the UK, while another 22% plan to spend “slightly less”.
Almost a third (31%) of US consumers say they will spend about the same, although a minority (19%) say they intend to increase their spending – either by “much more” than usual (8%) or “slightly more” (11%), which could provide a silver lining for certain categories, such as groceries, home activities and video-on-demand.
For its report, entitled The impact of Coronavirus on consumer spending in the US, Opinium asked Clark Nesselrodt, SVP of Brilliant PR & Marketing, an agency specialising in brands that target families, to analyse the data.
He described the finding that a full half of US adults expect their flexible monthly outgoings to drop as a “staggering figure” when compared with the UK, where only 37% say they will spend less, and that this does “not bode well” for the US economy.
It comes as a new report from Learn Bonds, the financial analysts, found that the number of unemployment benefit claimants in the US shot up 338% to an all-time high of 7.45 million by the week ending March 28th.
The fashion and clothing category is expected to endure the biggest fall in sales across the industries surveyed by Opinium, with around 38% of US adults saying they plan to spend less on these items in the wake of the coronavirus crisis.
However, shopping intent in this category varies greatly by age group, with older consumers much more likely to cut spending on fashion because of their preference for buying clothing in-store. Meanwhile, a quarter of 18-34s plan to increase their spending on fashion.
The homewares and furniture category is also likely to see a significant drop in sales, with 29% of US adults expecting to spend less on the category for the foreseeable, although this is more likely to occur among older consumers.
Yet there is good news for some categories in these difficult times. Not surprisingly, the survey found that 42% of US consumers expect to spend more than usual on groceries.
But spending is also forecast to increase for home activities and games (29%), movies on demand (29%), TV subscriptions (26%), books and e-books (25%), DIY (22%), online gaming (21%), as well as educational resources and children’s entertainment (both 20%).
“It’s ironic that while the impact on lives and the economy at large has been sobering, the opportunity for brands that sell products for kids and families online is tremendous,” said Nesselrodt.
Sourced from Opinium, Learn Bonds; additional content by WARC staff