Consumer sentiment in the US during the coronavirus crisis

We will continue to track changes in consumer sentiment and behavior as the next normal continues to evolve.

Five consumer themes emerged in October 2021.

Consumer optimism and spending have remained strong

Overall optimism and spend remained strong with 44 percent of US consumers feeling optimistic and spend increasing 11 percent year on year. High-income consumers are the most optimistic (61 percent) but all income groups contribute to the spend growth. Similarly, all generations are contributing to the growth even though millennials are most optimistic (62 percent). This growth is driven by both the intent to splurge which has been strong since February as well as elevated inflation, especially in the latter half of 2021.

Trend 1

Five different types of channel and category performances have evolved over the course of the COVID-19 pandemic.

Overall optimism on economic recovery following the COVID-19 pandemic continues to slowly increase in 2021.

More younger and higher-income consumers plan to splurge on spending.

Spending has been strong so far this year, with September showing an uptick potentially due to an earlier start on holiday spending.

Omnichannel is ascendant and here to stay

Consumer spend in stores continued to recover with 10 percent year-on-year growth in September following stable 5 to 6 percent growth in March through August this year. Simultaneously, e-commerce sales also continued to experience strong growth, rising by about 35 percent year over year, and online penetration remains about 30 percent higher than pre-COVID-19 levels. Omnichannel shopping is ascendant, with about 60 to 70 percent of consumers researching and purchasing both in-store and online across categories. Not surprisingly, social media influence is heaviest among younger consumers but influences all age groups, most commonly in categories including jewelry, accessories, fitness/sports, and cosmetics.

Trend 2

The trajectory of e-commerce penetration differs by category and remains elevated compared with pre-COVID-19 levels.

Online penetration holds steady at about 30 percent above pre-COVID-19 levels.

Loyalty shake-up continues

Over 60 percent of US consumers have experienced out-of-stock items in the last three months, and when this happened, only 13 percent waited for the item to come back in stock versus the 39 percent who switched brand or products and the 32 percent who switched retailers. Additionally, we see both increased trading down across income groups with trading up increasing as well among higher income groups.

Trend 3

Changes in consumer behavior have been more extensive among younger and high-income consumers.

Increased out-of-home activity for some, while investment in home continues

Almost half of US consumers are engaging out-of-home (for example, dining, shopping), compared to a third of US consumers in February. While engaging in certain out-of-home activities such as work, shopping, social activities, and indoor dining is becoming more common (over half of consumers state doing in the past two weeks), consumers continue to invest in their homes.

Trend 4

Investment in homebody economy continues to be strong.

Almost half of US consumers are engaging in out-of-home activities.

Strong and merry holiday season

Consumer demand is likely to be strong (fourth quarter estimated 7 percent growth versus 2020) particularly in discretionary, travel, and entertainment categories. High-income and millennial consumers are most excited about the holiday season (50 percent of high-income consumers are excited, compared to 25 percent of low-income consumers). Social media will have outsized influence across consumer purchases, particularly for younger generations, with Facebook, Instagram, YouTube, and TikTok expected to be the most influential platforms. Between 40 to 50 percent of consumers plan to shop early this year due to COVID-19 driven supply chain challenges as well as excitement for the holiday season.