Aussie consumers are supporting local businesses, embracing digital technology and spending more time on discretionary items such as gaming, new research has revealed.
A deep dive into Australia’s purchasing patterns from leading buy now, pay later (BNPL) service provider Zip has revealed a glimpse of the social, economic and cultural shifts we can expect in a post-COVID Australia.
Peter Gray, co-founder and COO of Zip, said: “Zip’s retail spend data is showing us how consumer spending can be a powerful barometer of broader economic and societal change ahead of us.”
The BNPL COO explained there are extraordinary economic and social factors that are causing consumer behaviour to be incredibly dynamic – “We haven’t seen these sorts of swings in spending before, ever.”
While consumer spending is changing, Mr Gray highlighted the medium and long-term impacts for businesses.
“From what we are seeing, we would predict this is a sign of things to come, people returning to shopping small and local and moving away from the cash society we have been so accustomed to.”
“The insights from Zip’s report can help retailers and small-business owners understand what the world after COVID looks like, and how they can better position themselves to thrive,” Mr Gray said.
Winners from the COVID-19 pandemic
The $200 billion global gaming sector has been revealed as the biggest winner from the COVID-19 fallout as organisations surged due to people being stuck at home.
According to results collated by Zip, consumers spent 115 per cent more on gaming in April, following a 285 per cent spike the week lockdown began.
The data also revealed that online marketplaces saw a 93 per cent spike in sales as consumers who were unable to visit shops swapped their spending online.
Bike shops and hobby stores were also big winners, with Aussies spending 76 and 53 per cent more, respectively, on each item.
Losers from the pandemic
Not surprisingly, forcing Australians to stay at home for non-essential reasons has had a big impact on money spent on parking as well as fuel costs.
Zip’s research revealed a 66 per cent reduction in parking costs, while spending on petrol stations fell by 47 per cent.
Australians are becoming more health conscious, with ATM withdrawals falling by 53 per cent due to consumers wanting to avoid touching money.
Finally, the report noted that cafes and small businesses were adversely affected by COVID-19.
“Last month, Australia’s coffee shops suffered a serious caffeine hit. Allowed only to operate through takeaway and home delivery, spending at cafes in April 2020 was half what it was in April 2019, although still higher than other affected categories.”
“Like cafes, many hairdressers remained open in April but were forced to adapt with strict social distancing restrictions in place. The financial impact on hairdressers was also similar to that of cafes, with spending down 52 per cent,” Mr Gray said.
Other interesting trends in general spending:
- Lingerie retailers fell by 39 per cent
- Fruit and vegetables increased by 39 per cent
- Hardware stores increased by 44 per cent
- Home pools and spas increased by 28 per cent
- Nurseries and gardening retailers increased by 58 per cent
- Outdoor home improvement increased by 50 per cent
- Security and safety system installation increased by 269 per cent
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We Translate Complicated Financial Jargon Into Easy-To-Understand Information For Australians
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