Retail Today: Consumer Reactions to COVID-19 and Implications for the Beauty Sector
As a result of the COVID-19 pandemic, beauty product consumers significantly changed their purchasing behaviors. Increased work-from-home, limited social gatherings and lower discretionary budgets due to economic uncertainty contributed to the change in beauty product consumer behaviors.
Despite recent, promising advancements in research for a vaccine, consensus is that we will have to live with COVID-19 for at least several more months, and potentially years. Therefore, changes in consumer behaviors will likely last beyond the current shutdown.
Based on an FTI Consulting survey conducted in April 2020 on 600 female beauty product consumers in the United States, FTI Consulting identified a set of key considerations for beauty retailers as they start to re-open.
- Focus on prices and value in times of uncertainty. With consumers uncertain about the future, an overwhelming number of respondents stated they curtailed spending on beauty products and focused on buying essential items. However, the silver lining is that respondents expect to spend on average 6% more on beauty products after the COVID-19 shutdown. Many consumers look forward to the post-shutdown phase, planning for more social gatherings and to treat themselves, especially among the 18-24 age group.
- Engagement is gaining traction among consumers. As COVID-19 impacts the workforce as well as communities and families, consumers are becoming more aware of brands’ social engagement. Consumers are more loyal to the brands that provide support to COVID-19 victims and frontline workers (34%) and financially support their workforce (34%). Before COVID-19, only ~3%-5% of consumers prioritized social engagement as part of their purchasing decisions.