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Understanding Consumer Sentiment Can Help Companies Adjust as the U.S. Begins to Re-Open
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Understanding Consumer Sentiment Can Help Companies Adjust as the U.S. Begins to Re-Open

Even though the year is almost half over, it’s just now starting to feel like a new year in parts of the U.S., as many states have allowed certain non-essential businesses like restaurants, movie theaters and retail stores to re-open in at least some capacity. We know, however, that many Americans plan to play it safe as businesses come back online rather than immediately jumping back into pre-lockdown behaviors. That’s why companies need to understand evolving consumer sentiment before assuming that open-for-business means business as usual.

The rise in CPG purchases (both on and offline) has been well documented throughout the lockdown period, but we have yet to see how consumers approach visiting non-essential businesses once they’re open again. We know that many businesses that closed will not re-open, but those that do will need insight into consumer sentiment in order to maximize their patronage—especially if occupancy and personnel restrictions apply. While most Americans are concerned about health risks, a recent Nielsen/Wizer Impact study found that, out of all the lifestyle changes caused by the pandemic, 62% of Americans miss eating out at restaurants the most, signaling that the doors that do open will be met by many with lively enthusiasm.

That’s not to say, however, that everyone is eager to head back to malls and their local bars. In March, a Nielsen survey of consumer sentiment about the pandemic found that 71% of Americans believe the spread and intensity of the novel coronavirus in their country would increase. Much of that sentiment remains intact, as the segmentation study found that 56% of Americans 18 and older consider themselves at medium or high risk for contracting COVID-19, the disease caused by the virus. As a result, 55% say they’re taking extra precautions when visiting the brick-and-mortar stores that remained open during the shelter-in-place restrictions. Importantly for businesses, both those open and those re-opening, health and safety will remain top-of-mind among consumers until a vaccine is developed.

For many, that reality means limiting exposure to places away from home, kindling the rise of the “homebody economy,” a global trend we’ve been monitoring since early this year. In the U.S., consumers began cooking more at home (54% say they’re doing it more), ordering from delivery services (17%) and patronizing local restaurants offering take-out (24%). Fast forward a month and much of that sentiment remained—even escalated—highlighting the significant trepidation Americans have about interacting away from home with large groups. In fact, our more recent impact study found that usage of restaurant delivery services and ordering more takeout from local restaurants has increased to 22% and 35%, respectively.

The homebody economy has also strained global supply chains as consumers rushed to buy and continue stocking an array of essential categories needed for long-term quarantining.  This massive uptick in CPG spending has elevated a trend we’ve been monitoring over the past year or so: brand switching.

While some brand switching can be attributed to supply chain strain, the pandemic is amplifying brand disloyalty: Americans are more willing to try new brands and products than we found they were in mid-2019.

In our global disloyalty study last year, just over one-third (36%) of Americans said they love trying new brands and products. This year, our segmentation study found that almost half (48%) say they’re likely to consider new brands. Few critical categories will be on sale during a pandemic, so much of this openness stems from product availability. Supply strain aside, however, consumers still value corporate social responsibility, noting the appeal of products from brands that are actively trying to help: 72% of CPG shoppers say they are positively influenced by brands helping consumers affected by COVID-19 and 65% favor brands that release advertising in response to the virus. And what’s more, consumers think brands shouldn’t continue doing business as usual.

Consumer behavior is shifting, requiring marketers to adjust their engagement strategies. Regardless of whether the task at hand is acquiring new customers or building brand awareness, marketers that understand new audiences, their interests and sentiments have a unique opportunity to establish and build meaningful relationships.

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