The impact of coronavirus on UK retail and leisure
The coronavirus was first discovered towards the end of December 2019 in China. We take a look at the current trends in consumer behaviour concerning the virus and the potential ramifications should the outbreak persist.
•Almost a quarter (23%) of consumers surveyed think that the coronavirus poses a high level of threat to health in the UK.
•Consumers suggested that they would avoid: ‘travelling abroad’ (19%), ‘contact with strangers’ (14%), ‘using public transport’ (12%), visiting ‘restaurants and entertainment venues’ (9%) and ‘shopping destinations’ (6%).
•Almost a fifth (18%) of consumers are in some way worried about product shortages as a result of the coronavirus.
Of those that said the current level of threat of the coronavirus (to health) was “high” or “very high”:
•Almost half (49%) suggested they would change what they bought to protect themselves (e.g. masks) should the virus persist.
•Over a third (35%) of consumers indicated they would shop more online (to avoid physical destinations) should the coronavirus persist.
•A quarter (25%) suggested they would avoid shopping destinations, while 42% would avoid contact with strangers.
•Over a third (34%) are worried about product shortages.
What impact could this have on retail and consumer spending?
Confusion and anxiety
There is confusion over the current level of threat. Around a quarter (23%) of consumers believe the coronavirus is a high threat to health in the UK, while around a third (35%) think it’s a moderate threat and two fifths (42%) see it as low threat.
This disparity plays out in differences in consumers’ habits. Concerned consumers (those who believe the virus threat is high) are five times more likely to currently avoid travelling abroad in order to protect themselves from the coronavirus and are 20 times more likely to avoid shopping destinations such as malls.
More than a fifth (22%) of concerned consumers have bought products to protect themselves from the virus. Around a third (32%) of these consumers are already avoiding contact with others and a quarter of them avoid public transport.
There’s further anxiety and confusion around how consumers can safeguard themselves from the virus. A staggering 48% of respondents would try to avoid buying online from international sellers that ship products directly from China if the virus persisted.
But the majority of shoppers (81%) are not worried about product shortages as a result of the coronavirus.
Avoiding future travel
If the virus persists, we expect to see a significant knock on impact to the retail and leisure sector. There could be a near three-fold increase in the number of consumers that avoid shopping destinations (6% currently avoid shopping destinations to protect themselves from the virus, compared to 16% who would consider it if the virus persists), while those who avoid restaurants and entertainment such as the cinema could almost double (from 9% currently to 17% if the virus persists in the future).
This would see more shoppers gravitate online, but also shop in less busy locations and avoid public transport. 41% would consider avoiding busier locations in favour of quieter destinations in the future if the virus persists, while more than a third (35%) would consider buying more products online to avoid physical destinations altogether. This is likely to impact city and flagship destinations the most.
The biggest impact, however, is set to be on holidays if the outbreak continues. 31% would consider avoiding travelling abroad in the future. Given that UK households spend around £2,200 on holidays abroad per year according to the ONS, this could put £17 billion at risk of not being spent on travel overseas.
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