Introduction

Since the beginning of COVID-19, lockdown has been implemented globally and individuals are forced to stay at home which leads to a change in consumer behavior. One of the most common changes is that consumers have chosen to do their shopping online as it is obvious that stores are not open in response to the current situation. However apart from online shopping and e-commerce, there are industries like healthcare, education  and many more that are highly impacted and do illustrate a change of consumer behavior, bringing in the importance of technology in this era.  So the question here is, what are the changes of consumer behavior on different perspectives under this new normal situation?

 

Aspects on the Change of Consumer Behaviour due to COVID-19

Health and Well-being

With the ongoing pandemic, consumers have been really aware of their health and well-being. According to a PWC United States survey, 31% of the survey correspondents have planned to or have made adjustments on their spending towards healthcare visits and 22% have reported on increasing their spending on medication due to the impact of COVID-19.

Chart 1: As a result on the impact of COVID-19, have you already or do you plan to adjust your spending on healthcare visits or medications? (Source: PWC Health Research Institute COVID-19 Consumer Survey, April 2-8, 2020)

Another research published by Deloitte has shown that around 90% of the respondents fear to visit the hospital  due to the high risk of getting infected by the virus while more than half of them are really concerned about healthcare after lockdown. Also, more than 70% of  them are willing to go to hospitals that do not treat COVID-19 patients and 45% are fine with going to hospitals that separate those patients in a different building.

Chart 3: Consumer concerns around health management  respondents (Source: Deloitte)

In addition, the majority of the consumers are willing to proceed with their elective procedures in the hospital once lockdown ends. However, only 28% of them are only willing to do it after the vaccine is created.

Chart 4: Willingness to undergo elective procedure % respondents (Source: Deloitte)

On top of that, almost 75% of the respondents have agreed on lesser hospital visits because of the infection risk, while showing an increase of at-home remedies, telehealth and telemedicine to avoid hospital visits.

Chart 5: Frequency of hospital visits once lockdown ends vs. pre-lockdown % respondents (Source: Deloitte)

Ever since the pandemic, consumers have started to explore new alternative platforms of home health care. E-pharmacy and E-health have been introduced to the society especially for chronic disease, cancer and mental health patients. The term E-pharmacy (or telemedicine) means the existence of online pharmacies that are able to prescribe medications for patients online and also deliver it to them without patients having to leave their homes. As for E-health, or also known as telehealth is a system that helps to monitor the patients with long term conditions to self manage themselves remotely. Part of the service consists of patients entering vital signs data like blood pressure readers, pulse oximeters or blood glucose monitors. After submitting the data, the information will then be passed on to a clinical or non-clinical monitoring service where the patient’s health is being observed. Also, this service does provide automatic coaching and mentoring for patients through questions and answers by the process of the system’s software algorithm.

Chart 6: Shift in preference towards home-based health care has resulted in an increase in usage of and preference for telemedicine across specialties. (Source: Deloitte)

Based on the chart above, the use of telemedicine has been slightly more than doubled during the lockdown from 21% to 44% of users. Among the respondents who designate an increase in telemedicine usage after lockdown, 77% of the respondents state that it is their preference with the reason of time saving. In addition, around 73% of them who had never tried telemedicine before, are inclined  to use telemedicine now. However, more than half of the respondents who are unwilling to use telemedicine due to their belief of face-to-face consultations are much more effective.

Chart 7: Willingness to use telemedicine for consultations across different specialties (Source: Deloitte)

By studying the result, the majority of consumers used telemedicine for general medicine while physiotherapy has the least usage of telemedicine due to the fact that it requires more in person sessions with physical examinations and rehabilitation.

 

Education

While countries are experiencing different points of infection rate of the COVID-19 virus, schools are forced to shut down. As a result, 1.2 billion students globally are not able to receive education due to school closures.  With the restriction of school lockdown, physical class has been shifted to remote learning. Upon such great demand on e-learning, many online learning platforms have provided free access to their services like BYJU’S which is a Bangalore-based edtech company founded in 2011.  According to Dingtalk (Alibaba’s remote learning app) CEO, Chen Han stated that they had expanded the capacity to support the large scale remote work by deploying more than 100,000 new cloud servers in just two hours last month from Alibaba Cloud. Besides, some school districts are forming unique partnerships, like the one between The Los Angeles Unified School District and PBS SoCal/KCET to offer local educational broadcasts, with separate channels focused on different ages, and a range of digital options. Furthermore, the UK media organizations like the BBC also offer curriculum-based virtual learning such as Bitesize Daily for children across the nation. With the right technology , e-learning is quite effective for students who have access to it as they require less time to learn compared to having classes in a traditional classroom setting. For example, Zoom is quite commonly used for meetings and educational purposes. As it has the function to record the whole lecture, students are able learn at their own pace by re-watching, skipping, or accelerating through concepts and chapters that they choose. However, there are some disadvantages on remote learning like students who live in areas that have bad internet access and are deprived of technology. For instance, 95% of students from countries like Switzerland, Norway and Australia are able to complete their lessons through online learning but only 34% of students are able to do that from countries like Indonesia. To resolve issues such as having poor internet access and technology, the government can provide digital equipment for students in need. For example, the Welsh government has a support programme with the collaboration of schools and local authorities to distribute devices to learners that are struggling without these equipment.

 

Entertainment

As lockdown restrictions are being implemented, public entertainment areas like cinemas, clubs, Internet cafes and more are forced to shut down leaving individuals to find their own entertainment at home. A lot of consumers choose to spend their time and distract themselves from the issues going on in reality by playing video games, e-sports and watching TV during the COVID-19 pandemic. According to new research by Nielsen, 82% of global consumers were involved in playing and watching video game content during the lockdown period.  As consumers are compelled to stay indoors, some leagues  have introduced e-sports (sport competition in the form video games) like eNASCAR iRacing Pro Invitational Series and NBA 2K tournament to keep gamers and fans engaged. With the commitment of these events, it is possible that e-sports and video games involvement could still remain high even when more live sports come back online. Besides, video games are well-known to be very engaging. Based on Nielsen Games Video Game Tracking (VGT), the number of gamers that stated they are playing video games more now due to the COVID-19 pandemic has increased since March 23, 2020. The U.S. has the highest rate (46%), followed by France (41%), the U.K. (28%) then Germany (23%). If TV is an indicator for overall media engagement during the pandemic, Twitch is the indicator for video game content engagement. As noticed below, the difference between Twitch engagement in the U.S. on January 1 and March 28 is more than doubled, as hours watched grew from 13 million to 31 million. The viewership was peaked on March 28, with League of Legends, Fortnite, and Counter-Strike: Global Offensive accounting for 33% of total hours watched across the top 50 titles.

Chart 8: Daily Twitch Viewership In The U.S. More Than Doubled In QI 2020 (Source: 2020 The Nielsen Company (US), LLC)

As we can see, the creativity of the video game industry has played a big part in helping consumers pass time which led to some collaborations. A great example is the collaboration of Epic Games with Houston rapper Travis Scott that organized a unique musical journey in Fortnite. This partnership that was worked out by Epic Games set a multi-date tour that consisted of different time slots to make it flexible for players to join from all over the world while Travis became the face of the event, attracting millions of people to tune in to the game from April 23-25, in addition to other video streaming platforms such as YouTube and Twitch. The Nielsen record for the average minute audience (AMA) for the first Travis concert had reached a total of 4.7 million, which almost half of the audience (2.3 million) were live viewers. While millions of people are self isolating at home, many looked to e-sports as a way to curb boredom.

Consumers have always turned to TV to stay updated on information or simply just for entertainment. Hence, it is normal even during the COVID-19 pandemic  as consumers are unable to attend social gatherings or any other physical events. In 2020, we see this trend reflected in a deluge of social media activity about TV programs as consumers lean into the power of technology not just to view or listen, but to also fill a need to stay connected to friends, family and the world at large. A recent Nielsen study on consumer behavior related to the TV has been shown in Chart 9. Apart from keeping close to home and their TV sets, they are also using social media to stay connected more which resulted a total volume of TV and COVID-19-related conversations on Twitter alone to  reach nearly 9 million since the start of 2020 in the U.S. with a dramatic increase of 40 times between January and March due to the pandemic. As more consumers are forced to stay at home, they have been using social media to fill their time and discuss about the new TV, streaming, and movie choices. Despite there being a number of programs on air over the years, it is still noticeable that there is a big difference in social media activity across most TV genres. As expected, we see the biggest upticks in social buzz about talk and news programs, family movies and all streaming services.

Chart 9: Number Of TV Tweets Mentioning COVID-19 Or Coronavirus (Source: Nielsen Social Concern Ratings)

 

Travel and Mobility

The travel behaviour of consumers has also been affected after the outburst of the pandemic. As lockdown rules are being enforced, consumers’ mobility habits do have some changes such as avoiding public transport but instead riding a bicycle or walking for local trips. For example, Germany had implied a travel ban on March 23rd 2020 and the distance traveled per person per day had dropped from the usual average of around 40km to almost 15km only in the first week of April. Thus, it leads to a decline in the number of kilometers traveled on public transport, as consumers prefer to walk or ride a bike.

Chart 10: German Mobility : Average Kilometers Travelled By User And Day (Source: MotionTag)

As consumers had preferred to walk and cycle, the time spent has increased 25 minutes per day  compared to the usual less than 20 minutes per day.

Chart 11: German Mobility: Modal Split For Time Spent Travelling By User and Day (Source: MotionTag)

As can be observed, the increase of consumers making short journeys for activities like food shopping locally by walking or cycling has not only reduced physical contact with other people but is also a good way to combine it with regular exercise. Though cars are still in use, usually essential workers that do not work from home only use it for work.

Another important travel behavior aspect is airplane travel. As the spread of COVID-19 virus gets worse, many countries have banned international flights and consumers are afraid to take flights due to the high risk of getting infected by the virus. This has caused a dramatic drop in demand for passengers in this industry due to the current situation which threatens the businesses of many firms under the aviation industry. As we are aware that the aviation industry is also a target for government policies, the recent crisis has resulted in new loan guarantees, subsidies in wages and equity injections. To deal with these issues, government policies should prioritise firm specific measures like preserving competition and strike balance between the support of the aviation industry. Due to the pandemic, the failure of a number of companies will lower the competition and the injection of equity might affect the access of foreign companies to the local market. To avoid negative effects on competition and promote efficiency on controlled firms, lowering the costs of entry like reserving airport slots for new entrants can help to foster the competition.

Chart 12: Expected change in airplane travels once the COVID-19 is no longer a threat as compared to the before-pandemic situations. (Source:  Science Direct)

As we can observe from Chart 12, around 43% of the consumers choose to travel less frequently with airplanes in the future even if the COVID-19 condition is in control.

Chart 13: Factors underlying the expected change in airplane travels once the COVID-19 is no longer a threat as compared to the before-pandemic situations. (Source: Science Direct)

According to Chart 13, the majority of correspondents of the survey (48% of them) felt unsafe travelling with airplanes due to the closed space even after the pandemic, followed by 27% of them choosing to travel by their personal vehicles.

 

Conclusion

It is not surprising that the outbreak of COVID-19 has given such high levels of impact and changes on consumer behavior. The majority of it consists of the use of technology and without the help of it, society will be struggling in getting things done and inconveniences in different aspects will occur. Despite the negativity of the pandemic, we have to be grateful and embrace the modern high tech life that we are living in as technology has helped us get  through these hard times.

 


Researcher: Yeoh Yi Ying (Janice)

Reviewer: Millen Lau

Editor: Adam Jantan

Download the article here: How-COVID-19-Affects-Consumer-Behaviour.pdf


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