Type to search

Retail Industry Updates

How COVID-19 Has Changed Consumer Behavior for the Long Term

Share
Home fitness looks like it’s here to stay.

The COVID-19 pandemic has changed consumer behaviors and will continue to change them in 2021— even with vaccine distribution beginning this week and continuing for the next several months.

How much has it changed them? New York City-based Coefficient Capital, a venture capital firm focused on digitally powered omnichannel consumer brands, partnered with The New Consumer, a publication about how and why people spend their time and money, to find out. The two entities have unveiled a new report, “Consumer Trends 2021,” to examine consumer behaviors that may be forever changed by COVID-19.

The “Consumer Trends 2021” report is based on extensive research from a range of proprietary and public data sources. Coefficient Capital and The New Consumer worked with Toluna Inc. to survey more than 3,500 U.S. consumers on their shifting behaviors resulting from the COVID-19 pandemic. The survey, conducted in November, asked consumers about their spending habits, consumption patterns and other behaviors related to food and beverage, fitness, alcohol and beauty. Earnest Research, a data analytics firm, also provided custom data on consumer spending and foot traffic for the report.

“The COVID-19 pandemic accelerated many consumer trends that had been set in motion years ago, including online grocery shopping and at-home fitness,” said Franklin Isacson, founding partner at Coefficient Capital. “Consumers now prefer many of these behaviors and don’t want to give them up. Brands will have to make long-lasting changes if they want to succeed in 2021 and beyond.”

Some of the “Consumer Trends 2021” findings include:

COVID-19 drove record e-commerce sales this year and forced new lifestyles and habits. Consumers prefer many of their newly adopted behaviors, suggesting they will continue beyond the pandemic:

• 52% of millennials and 44% of Generation Z prefer online grocery shopping.

• 81% of millennials and 50% of Generation Z prefer working out at home.

Online grocery adoption hit an inflection point in the U.S. in 2020, more than twice its initially predicted volume. And it’s poised to accelerate, further transforming a $1 trillion industry:

• 36% of Generation Z and 30% of all consumers say they’ve been shopping for food and beverage online more during COVID-19.

• Consumers are unbundling their shopping carts, spending with internet-native grocers, delivery apps and directly with brands. About one fifth of consumers say they prefer to buy food and beverages directly from brands’ websites.

Consumer behavior in beauty and skincare has fundamentally changed, favoring more and smaller brands:

• Younger consumers are unbundling the legacy beauty industry and using more brands: 48% of Generation Z say they use four or more brands in their beauty routines, compared to 23% of the baby boomer generation.

• Beauty brand preferences vary by generation: Generation Z consumers reported using Anastasia Beverly Hills, Fenty and Kylie, while millennials reported using Glossier, Charlotte Tilbury and ILIA.

Home fitness is now the default, and looks like it’s here to stay, with $100 billion in global health club spending up for grabs:

• 82% of millennials and 76% of all consumers say they’ve switched to exercising more at home during COVID-19.

• 81% of millennials and 66% of all consumers say they prefer it.

Americans love their hard seltzer, and low- and no-alcohol drinks have become part of many COVID-era routines:

• 45% of millennials say they’ve been drinking hard seltzer during COVID-19.

• 36% of millennials say they’ve been drinking canned cocktails.

• 24% of millennials say they’ve been drinking non-alcoholic beer.

• 22% of millennials say they’ve been drinking non-alcoholic spirits.

Tags: