Head of Strategy & Planning
As fear over the future of the UK economy grows, there’s increasing evidence that consumers are reducing non-essential purchases and moving their spend to support small and local businesses.
To help you stay abreast of changing consumer behaviour, and the digital and media impacts of the Coronavirus pandemic, we’ve compiled key insights in our weekly digest.
If you’d like bespoke research into a specific topic, industry or vertical affected, contact us through your account manager or at email@example.com.
The past month has seen significant shifts in consumer buying priorities in the UK, with consumers saying they’re shopping online more for goods across the retail spectrum. Perhaps surprisingly given that 60% of UK consumers say they believe Coronavirus will continue to impact the world globally for up to a year, 2% of UK consumers are still booking holidays to take in the future (Source: Global Web Index Wave 2 Covid-19 2020 research)
Within the survey, 14.1% reported that they’re shopping online more for entertainment items. And search trends offer an insight to other ways people are spending their time in lockdown.
While search interest for health-conscious activities – home workouts, yoga and running – increase across the UK, consumers are also picking up less-healthy habits.
The eMarketer Ecommerce Survey, conducted in April 2020 by Bizrate Insights, saw a 1% increase in tobacco products or smoking accessory purchases in the US online. And Kantar reported a 22% raise in alcohol sales in the UK last month.
But we’re already seeing counter behaviour. There was a 15% increase in search volumes for ‘quit smoking’ related keyword lists in January-March 2020, compared to the same time period in 2019, and a 22% increase just in March 2020 vs 2019.
Some 37.5% of consumers now state that they’re concerned about the UK’s economy, according to Global Web Index Wave 2 COVID-19 research, and as confidence in the health of the economy drops, communities are rallying round to support small, local and independent businesses.
Brandwatch tracked a 12% global increase in the use of hashtags and conversations around shopping and supporting local and independent from January to April 2020, compared to the same period in 2019.
Since the beginning of lockdown, there’s been a flurry of activity to get small businesses up and running digitally, and those who have set up an ecommerce presence are starting to reap the rewards.
The overarching sentiment towards supporting local businesses is positive, with emotions of joy stemming from local pride and a willingness to help where it’s needed.
Anger and fear registers from local communities feeling frustrated with the government response and worries that beloved local businesses might not survive the pandemic.
This trend for shopping small is also reflected in search interest across the UK, with a 28% increase in April 2020 for ‘local businesses’ and ‘supporting local businesses’ compared to March 2020.
Overall there has been a 111% increase in UK search volumes surrounding supporting local businesses from January-April 2020 compared to the same period in 2019. Additionally, Global Web Index’s most recent COVID-19 research data shows that 31% of UK consumers want brands to support local suppliers and 46% for them to be socially responsible.
Although governments are providing a host of emergency support measures, the negative economic impact of the COVID-19 crisis is likely to touch all scales of business.
However, the lockdown has stimulated heightened demand for other digital entertainment media services, as well as for internet access / data requirements.
These trends may accelerate longer-term structural changes to the digital marketing landscape, including changing consumer media consumption habits, use of digital platforms, and potentially a reduction in traditional physical media and advertising models.
In the short-term the fact that consumers are spending even more time online (across all age demographics) is supporting ad effectiveness. It’s predicted that media costs will continue to reduce given the higher volume of people online / on social media platforms, and digital ecosystems are set to be key channels in the recovery climate.
Many marketers have pulled back spending across digital channels, in particular across social, despite users engaging with social media at higher rates.
Social Bakers reports lower CPCs and CPMs across Facebook and Instagram, and iCrossing’s Paid Social team has related a similar picture of reduced costs across live campaigns. On Facebook, CPM ad pricing fell as much as 50% in March, according to agency and ad tech executives.
Lower ad prices have attracted small and independent business, and businesses in industries such as technology, telecom and consumer packaged goods have continued to spend across social to reach consumers who are spending more time at home.
The lower demand for paid ads on Facebook has seen organic content performance increase. And brands that supported their posts by taking advantage of the lower ad costs saw a 28.6% increase in page reach from 13th March to 13th April.
Concerning those continuing to advertise, a report recently issued by Edelman into the public’s trust in brands during the pandemic concluded that their actions will be remembered by consumers long after lockdown has lifted. Over two-thirds of respondents (65%) to the report suggested that the way a company responded to the crisis would have an impact on the likelihood of them buying its products in the future. A further 37% of respondents claimed to have switched brands or used a new brand as a result of the way it responded to the outbreak.
Morrisons, Apple, Pret a Manger, Marks & Spencer and Co-op have all been praised for the measures they’ve taken to keep staff and customers safe and financially supported as well as giving back to local communities and key workers.
Businesses still able to deliver on supply and demand may increasingly look to invest in digital – following Coca-Cola’s lead of reallocating media budget to digital. And if doing so, we recommend considering brand messaging over performance-oriented advertising, at least until the UK and global economy starts to reopen.
As resources are freed from paid campaigns, this is also a good time to optimise your website and content to improve performance, gain insight to boost conversion rate and investigate automation solutions to maximise ROI.
To find out how we can help your business get fit for recovery, contact us through your account manager or at firstname.lastname@example.org.
We leave you on a positive note:
Refugees are helping bee colonies despite the lockdown.
This week Positive News reported that refugee beekeepers were helping the black bee re-establish itself in the UK during the lockdown. The black bee was mistakenly thought to have died out in the UK, but has been given a boost by two refugee-led beekeeping projects, one of which raised £12,000 this week to establish 20 colonies in west London. The initiative is also designed to help refugees integrate in the UK.
We believe that moving too slowly in digital is the biggest risk your business faces. If you are ready to move faster in digital, we are here to help.