It’s clear that the COVID-19 pandemic has not only had a significant impact on marketing and advertising but also on consumer spending behavior. New data released by Gallup shows that half (51%) of the American consumers surveyed in April say that in recent months they have spent less money than they used to.
This comes after a decade of steady declines in the percentage of consumers who reported spending less, from a high of 57% in 2010, and is in stark contrast to the mere third (32% share) of consumers who reported spending less than usual just one year ago.
At the same time, the share of consumers who are spending more has dipped to 21% (down from 34% in 2019), while those spending the amount that they usually do has decreased (28% in 2020 vs. 34% in 2019).
Although those cutting back on their spending span all income groups, it’s middle-income (HHI of $40K-$100K) and upper-income (HHI of $100K or more) households where the change is most noticeable. Indeed, 56% of middle-income households and 54% of upper-income households have cut back on spending this year – up from 33% and 28%, respectively, in 2019. By comparison, 45% of lower-income households (HHI of less than $40K) report spending less. This is compared to 34% who said they were spending less last year.
While the decrease in consumer spending can be attributed to stay-at-home initiatives and store closures during the outbreak, more than half (53%) of those Americans surveyed who have cut their spend believe that this reduction in spending will become their new normal in the years to come. In other words, more than one-quarter (27%) of all adults surveyed are spending less and believe this will be their new normal. The remainder (47% of those spending less; 24% of respondents overall) are more optimistic and say that their decrease in spending is only temporary.
Read more here.
About the Data: Results are based on telephone interviews of 1,016 US adults (ages 18+) conducted between April 14-28, 2020.
