Economies around the world have stalled because of mandated lockdowns. For many people, the future looks grim indeed.
Yet for others, the lockdown has freed up time to plan for better times.
The current conditions are rare – we’re dealing with the double whammy of a forced economic slowdown combined with a health crisis. There aren’t too many similar cases in history, though the SARS outbreak in 2003 comes close.
We had a look at which market segments surged after the SARS outbreak was contained, and discovered some surprising patterns in consumer spending.
Gyms and Outdoor Sports
Like we have now, the SARS outbreak in 2003 pressured the Chinese government to close public places to control the spread. Included in these closures were indoor sports complexes and gyms. When SARS was finally controlled, there was a spike in gym membership and outdoor sports participation.
Interestingly, there was more demand for fitness activities after the SARS crisis than before.
One reason why people became more sensitized to their physical fitness might be related to the psychological process of ‘priming’. In psychology, when people are exposed to certain situations the experience changes, or primes, their future behavior. For example, if we find a $20 bill under a bench one day, each time we see a bench in the future we might glance under it just to check.
This priming effect might explain why people focused on their physical fitness after the SARS threat – they were sensitized to getting fit because they were primed to think about their health.
When we emerge from the COVID-19 crisis, we might expect to see a similar spike in gymnasium and sports club exercise.
One of the things people tend to put off when times are tough is getting married. In past recessions we’ve seen a dip in marriages, culminating in a surge when the economy gets going again. Most famously was the phenomenal spike in births and marriages after WWII, giving rise to the baby-boom generation.
Increased optimism about the future fuels decisions to settle down and start a family. In the current climate, this effect could be exaggerated because of the mandated lockdowns and social distancing rules.
We expect a spike in marriages coming out of the Coronavirus crisis, but perhaps also a spike in births. Since marriages also tend to increase with pregnancy rates, the current crisis might give rise to the next generation known as the ‘corona-babies’.
According to data from trend analysists Glimpse, products selling well since the lockdowns include dumbbells, vitamin C tablets, bidets, and bread makers. Also selling well are household cleaning products as people spend more time in their homes and become more sensitized to cleanliness.
There was a similar trend during the SARS virus. Yet curiously, the trend continued after the SARS virus was contained. Like the spike in gym memberships and outdoor sports activities, it seems that people become sensitized to their wellbeing after a health crisis, with new cleaning routines persisting well after the virus threat has passed.
We expect to see a similar pattern of demand when the Coronavirus is contained and the economy improves. It seems likely we might see a host of related cultural shifts related to personal cleanliness, from increased handwashing to the acceptance or wearing masks in western cultures.
Lockdowns and mandated self-isolation rules around the world have forced people to cook at home when they would otherwise have eaten out. Although there were no mandated lockdowns during the SARS virus, concerns about the safety of restaurant food did increase the precedence of eating at home rather than going out.
As people threatened by the SARS virus learnt more about cooking, they also tended to purchase more cooking appliances to aid their newfound skills. This trend persisted well after the SARS virus was contained.
We also expect to observe this trend as normality returns following the Coronavirus threat. As restaurants reopen and life slowly returns to normal, it seems likely there will be more people continuing to cook for themselves. Perhaps partly driven by a lingering skepticism over the safety of external food sources, or more likely, a resurgence of interest in the joys of cooking.
Markets progress through calculable patterns cycling through expansions and contractions, and consumers respond in predictable ways. Things might be worse than normal given the nature of a pandemic, but things always get better. Now is the time to plan for the future by predicting from the past.
Dr Brent Coker is a Consumer Psychologist at the University of Melbourne