Lagging Consumer Sectors Like Travel, Hospitality, Clothing and Department Stores Staging a Comeback This Holiday Season
U.S. consumers once again have proven themselves to be highly resilient and adaptive during the Covid-19 pandemic. Their buying behaviors have evolved quickly and dramatically to address new priorities and limitations, with consumer spending growing solidly in most categories, according to a new report just published by the CMO Council.
Consumer-facing brands and retailers were also responsive to the changes brought about by Covid, moving rapidly to upgrade digital and e-commerce experiences, and becoming increasingly data-driven. They will need to continue to adapt to the realities of a post-pandemic world, with new products, selling and marketing models, and digital and in-store experiences that align with tomorrow’s new normal, according to the report, developed in in partnership with Commerce Signals, a Verisk business.
The report, “Gaining Lift from the Consumer Shift: Insights into Buying Behavior During Covid and Beyond,” explores how consumers, businesses and marketers shifted focus during the pandemic to address changing needs and requirements, as well as what these changes will mean to the future. Many of the findings are based an analysis of anonymized credit and debit card spending data for 40 million U.S. households from Commerce Signals. The report also incorporates the views of senior marketers and other executives from a cross-section of retailers, media companies and brands, including Audacy, Cuisinart, Echelon, Lamp Plus, Pokeworks, Fandom and Trax.
To download the full report, please visit: https://cmocouncil.org/thought-leadership/reports/gaining-lift-from-the-consumer-shift
Among report findings:
“Consumers are going to be consumers. Spending shifts, but it doesn’t stop,” said Nick Mangiapane, CMO of Commerce Signals. “Our analyses of card spending throughout the pandemic makes it clear that U.S. consumers quickly reshaped their buying behaviors to meet new needs and desires. For example, clothing and department store purchases declined during the epidemic since there were fewer reasons to dress up. On the other hand, streaming media and home furnishings both grew significantly to fit with a stay-at-home lifestyle.”
“The past 18 months have underscored the need for marketers to continuously monitor, predict, and respond to the fast-changing needs and behaviors of consumers,” said Dave Murray, executive vice president with the CMO Council and author of the report. “Going forward, marketing teams need to fine-tune their ability to track consumer purchasing patterns and pivot quickly when necessary. That includes the use of timely, granular and localized spending data for marketing planning, audience segmentation and personalization.”
The Shift to Online Spending
One of the main ways the U.S. consumer adapted to the pandemic was to dramatically shift spending to online channels. Retail online sales skyrocketed in 2020, tripling its growth rate from the previous year. During the period from March 2020 to March 2021, online retail sales were up 56% compared to the previous 12 months.
Nevertheless, in-store shopping has rebounded in recent months. In fact, Commerce Signals projects that during the coming holiday season, in-store sales will be a major driver of growth for retail spending, growing 15 percent compared to the same period of 2020. Online retail sales will grow only 3% from the year-ago period, as online sales growth slows from its huge surge of 2020.
Retailers and other consumer products companies responded to the big uptake in ecommerce in 2020 by rapidly moving to improve online purchasing experiences. From ecommerce website upgrades and home delivery improvements, to buy-online/store-pickup models — retailers and other consumer-facing brands adapted to the new consumer mindset and behaviors.
Retailers will need to focus on upgrading both their online and instore experiences in the future, making it easier for customers to understand and see available inventory and make purchases and also build on new hybrid models such as the buy-online/store-pickup models.
About the CMO Council
The Chief Marketing Officer (CMO) Council is dedicated to high-level knowledge exchange, thought leadership and personal relationship building among senior corporate marketing leaders and brand decision-makers across a wide-range of global industries. The CMO Council’s 16,000+ members control more than $1 trillion in aggregated annual marketing expenditures and run complex, distributed marketing and sales operations worldwide. In total, the CMO Council and its strategic interest communities include over 65,000 global marketing and sales executives in over 110 countries covering multiple industries, segments and markets. Regional chapters and advisory boards are active in the Americas, Europe, Asia Pacific, Middle East and Africa. The Council’s strategic interest groups include the Customer Experience Board, Digital Marketing Performance Center, Brand Inspiration Center, Marketing Supply Chain Institute, GeoBranding Center, and the Coalition to Leverage and Optimize Sales Effectiveness (CLOSE). To learn more, visit https://www.cmocouncil.org.
About Commerce Signals
Commerce Signals, a Verisk Financial business, is a leading source of credit and debit card data for marketers. With a permissioned and anonymized view of consumer credit and debit card spending behavior, Commerce Signals’ powerful insights, accurate audiences and campaign measurement help eliminate waste and boost marketing ROI. Its solutions are used by some of the largest retailers, direct to consumer and adtech companies in the country.