Primarily caused by the COVID-19 pandemic, 2020 has been the most volatile period of consumer spending in U.S. history. In 2019, consumer spending totaled $13 trillion, with services contributing to more than half of that spending ($8.5 trillion), non-durable goods accounting for a small portion ($3 trillion) and durable goods accounting for an even smaller portion ($1.8 trillion). The pandemic has dramatically changed these numbers for 2020. Service-related spending has crashed, while both durable and non-durable good purchases have skyrocketed. Durable goods driving this increase include vehicles, firearms, furniture and computer software. Non-durable goods driving this increase include pantry goods, clothing and alcohol. These purchases are driven by a boost in time spent at home and perceived safety of traveling by personal vehicle.
While a boost in these segments is promising, the segment that typically makes up the bulk of consumer spending—services—continues to suffer. While service spending is up from March and April’s levels, it is nowhere near the pre-pandemic normal. Services that are prospering include gaming and dining, while medical-related services are surprisingly down 40% from this time last year. Experts believe that the rollout of a COVID-19 vaccine will boost spending in this industry, especially travel-related services, but any delay in availability will likely cause the recovery to be slow. (Seeking Alpha, 09.27.20)
There is no doubt that these changes in consumer spending are affecting your brand. Now is the time to get creative, adjusting strategies to not only meet the needs of your consumer, but to generate revenue during this unprecedented time. H2R is proud to offer a suite of customizable studies that can help your brand be successful even now. Check out our options here and schedule a free consultation today.