Consumers in Europe remain weary of activities that involve close proximity with others, with most expecting at least 18 months to pass before life goes back to normal. This is according to a new consulting firm Bain & Company study.
Across all five countries, the majority expects it will take 18 months or more for life to resume as normal, while a small set believe that things will never normalise. Interestingly, Bain and Dynadata conducted a similar survey back in May, when people emerged as far more optimistic.
At the time, most respondents thought it would take half a year for things to stabilise, or a year at most. Many even thought that we’d be done and dusted within 5-6 months. Now, the five to six month bracket has shrunk considerably, while those expecting a year and a half of recovery time are at par in numbers with those expecting 7-12 months. Most of the rest fall into the 13-17 month bracket.
There are some variations across individual markets. For instance, most consumers in Italy are hopeful about things stabilising in the next year. At the other end of the spectrum, France and Sweden have the highest share of consumers expecting an 18-month or more recovery period. That being said, these differences are marginal, and the bigger picture is one of a cautious and increasingly pessimistic consumer sentiment.
Covid-19 cases
The development is in part a result of spikes in Covid-19 cases across Europe in recent weeks, as lockdowns were lifted and crowds returned to public places. Against this backdrop, the researchers found that most consumers are hesitant about resuming normal routines, with a strong tendency to avoid close proximity and crowded spots.
Certain activities remain off limits. For instance, most will refrain from taking a busy bus, train or plane over the next year at the very least. As a direct result, the number who plan to go abroad on holiday in the same period is also much less than before the outbreak. Instead, vacationers are choosing to holiday close to home, where personal vehicles can be used for access.
In similar vein, restaurants and bars are also falling out of favour for fear of infection. Broadly, consumers are focusing on essentials, with activities such as grocery shopping remaining constant or even increasing. Nearly half of all respondents, meanwhile, expect to spend more time at home in the next 12-18 months than they did before the crisis.
As people were forced to work from home under lockdown, many businesses realised that virtual working was a viable option that could prove more cost effective and efficient in many cases. As businesses remain in no hurry to get back to the office, and fear of infection keeps usual leisurely activities out of bounds, people expect to be at home a lot more.
Social needs
As they do so, their social needs are being met through their own ‘bubble,’ consisting of close family and friends. Such gatherings will remain fairly frequent in coming months. Another natural consequence of being at home has been a spike in online shopping, which allows consumers to get what they need without venturing out and risking infection.
Online shopping increased in the immediate wake of the lockdown, and many suggest that the preference for online might just be here to stay. The crisis saw many familiarise themselves with online payment methods and other digital platforms. Usership is expected to increase for the long haul as a result.
In fact, many of the behaviours expected to persist over the next 12-18 months are natural continuations from life under lockdown. Since the middle of March, Bain reports that grocery shopping was among the only trends that saw an increase, while other shopping, office working, dining out, travel on public transport, going to the gym, and other travel and leisure activities have all been on the decline.
Many analysts have suggested that the lockdown might have changed consumer priorities for good. Judging by Bain’s analysis, the crisis has had an impact that will last a year at the very least, if not longer. For those who are now venturing out, certain expectations have emerged, such as hand sanitisers in offices and restaurants and a degree of social distancing, all of which will persist for the foreseeable future.
Again, these are broad-based trends, and some variations are visible by country and demography. Younger consumers, for instance, are far more comfortable venturing out, presumably as Covid-19 poses a lower threat for them. By nationality, France and Sweden have seen lower levels of caution amongst consumers, while the UK and Italy have seen minimal activity.
Nevertheless, the overall sentiment remains one of caution, and Bain’s report suggests that this will persist for the medium term at the very least.