COVID-19: Financial health beats well-being as top fear
COVID-19: Financial health beats well-being as top fear in New Zealand
• 32% of New Zealanders believe COVID-19 could lead to an economic recession with the risk of people losing jobs
• 28% of people in NZ feel COVID-19 demands them to be more proactive about financial planning
• 22% of people are worried about falling sick. People are stocking up on hygiene and cleaning supplies and avoiding travel to minimise risk
New Zealand, 12 March 2020 – With the number of cases of COVID-19 in New Zealand still low, the top fear is not falling sick but the threat that the virus may hurt people’s financial health, according to a recent study conducted by Kantar, the world's leading data, insights and consulting company. As global financial markets plummet in what seems to be the worst downturn since the Global Financial Crisis, one in three New Zealand consumers believe a recession is likely with resulting job losses, although only 24% are concerned about their own job. As a result, there is an emphasis on being more proactive about financial planning (28%). Fear of catching the virus in contrast is lower (22%) reflecting the fact it is not yet prevalent in New Zealand, in contrast to Asia where a Kantar study found 60% concerned about falling sick.
As New Zealanders’ awareness of their own safety has heightened, they expect the same with brands on the products and services they offer. 61% of New Zealanders expect travel and tourism brands to provide an environment that reduces risk for customers and staff. The same is expected from the banking industry with 59% of New Zealanders saying their banking provider needs to actively reduce risk. 55% of New Zealanders want consumer goods brands to ensure their products and services are safe to use.
Changing consumption and lifestyle behaviours
The Kantar study shows how people are adjusting their lifestyles to reduce the risk from COVID-19. The industry hardest hit by the outbreak is travel with 39% of people saying they have decided to travel less internationally and 17% less within New Zealand. 21% are less likely to go to the cinema and 18% of people are less likely to eat out.
Purchase behaviours have also shifted as the threat from the virus has grown. The most apparent development has been the rise in ‘panic purchases’. Predictably, categories associated with hygiene and health have seen the biggest rise in purchases, with 20% of people saying they are buying more personal hygiene items, 13% are buying more home cleaning products and 12% are buying health and nutritional items such as vitamins to improve immunity.
The study highlights how COVID-19 is resulting in consumers expressing a heightened focus on products and services that are ‘safe to use’, especially when it comes to the food and beverage category and consumer goods. In addition, they are looking for brands that have enhanced health and wellbeing benefits to help build a strong defence against the virus.
Jason Shoebridge, CEO of Kantar New Zealand, says, “This research shows consumers have both short and long term concerns about the spread of Covid-19. In the short-term people are understandably alarmed and doing what they can to stay safe. Many are changing what they are doing and the things they are buying and some admit to panic buying. But what people worry about most is what COVID-19 will mean for their financial security as it potentially impacts the economy in the longer term. This poses an added problem that the behaviour of consumers will continue to be affected well after the immediate health concerns around the virus abate.
“Looking at it from a business viewpoint, people are expecting brands across all industries to take action which will keep them safe and organisations should be communicating to their customers what they are doing. For example, Air New Zealand has sent emails to its customers telling them what actions they are taking to keep their customers safe and minimise the impact to them of disruption of their travel plans. These actions reinforce the trust consumers have in particular brands and we know from our global research that in times of economic volatility organisations with strong brands recover more quickly than their competitors.”