First Insight Survey Finds Improved Consumer Confidence Does Not Translate to Higher Spending

As the country celebrates the unofficial beginning of summer this Memorial Day weekend, will consumers celebrate the easing of restrictions at the mall? Retailers across the country have marked down everything from swimwear to cars, but how has the pandemic of the past eighteen months shaped shoppers’ behaviors?

“More than a year after we began this study, our findings show that consumers are still very much concerned about how the pandemic is affecting their personal finances and overall feelings of safety while shopping.”

According to a new consumer report by First Insight, consumers are less worried about the Coronavirus overall, but spending and behavior remain unchanged from the height of the pandemic. The company has been engaged in a longitudinal study of consumers since February 2020 to gauge their overall concern about the Coronavirus and how COVID-19 will affect shopping and purchase behavior.

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The study found that 32 percent fewer respondents said that they were very or somewhat worried about the Coronavirus in April, 2021. Overall, 59 percent of those surveyed said they were worried, compared to a high of 87 percent one year earlier in April 2020.

However, the survey also found that consumers are not quite ready to begin spending at pre-pandemic levels. First Insight found that six in ten consumers continue to say that they expect to cut back on spending from pre-pandemic levels, which is only a slight improvement (59 percent versus 62 percent) over the previous year, suggesting that consumer spending habits may be undergoing a long-term shift.

Similarly, the survey found some improvement in expectations about purchase decisions, but three out of four consumers last month said that their purchase decisions have been impacted, down from 89 percent last April.

“Retailers may be encouraged by the green shoots they are seeing now that many places are reopening, but it would be foolish of them to assume that everything will magically revert to the way things were in 2019 or early 2020,” said Greg Petro, CEO of First Insight. “More than a year after we began this study, our findings show that consumers are still very much concerned about how the pandemic is affecting their personal finances and overall feelings of safety while shopping.”

Some gains were made in perceptions of in-store shopping safety.

Trying on clothes in a dressing room. Sixteen percent fewer respondents (50 percent) say they do not feel safe trying on clothes in dressing rooms today, an improvement from last year when only 58 percent said they felt unsafe.

Trying on shoes. Thirteen percent fewer respondents (47 percent) say they do not feel safe trying on shoes, an improvement from last year when only 53 percent said they felt unsafe.

Testing beauty products/makeup. Consumers’ opinion remains unchanged on the safety of trying on beauty products or cosmetics in-store, with a significant majority—69 percent—feeling it is not safe.

Working with a sales associate. Today, 53 percent of consumers said that they feel unsafe working with a sales associate in-store, an improvement of 9 percent since April 2020 when 58 percent said that they felt unsafe or very unsafe.

The Majority of Respondents Are or Plan to Get Vaccinated. As vaccines continue to roll out across America, almost half of those surveyed (47 percent) already received the COVID-19 vaccine. This compares to 24 percent that have not gotten the vaccine, but plan to when able and 29 percent that don’t plan to get vaccinated or are not sure.

Methodology

First Insight’s findings were based on data from the company’s ongoing series of consumer sentiment studies entitled, “The Impact of Coronavirus on Consumer Purchase Decisions and Behaviors.” The company has been tracking consumer data since February 28, 2020. The findings are based on the results of U.S. consumer studies of targeted samples of more than 1,000 respondents, balanced by gender, geography and generation, and the latest survey was fielded on April 21, 2021. It was completed through proprietary sample sources amongst panels who participate in online surveys. Further details on the findings are available upon request.

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