#10things: What consumer behaviours will be Covid-keepers?

With the release of the latest annual BrandMapp study, 30,000 South African consumers have spoken in-depth about their shopping over the first pandemic year. For the past eight years, the release of the annual BrandMapp survey by consumer insights consultancy WhyFive, offers data insights to brands on what the middle class and top earners in South Africa are spending on. This year, there’s obviously a Covid-inspired edge as “businesses grapple with understanding the pandemic impacts on consumers, and struggle to split hype from facts”, says Brandon de Kock, BrandMapp director of storytelling.

BrandMapp specifically surveys South Africans living in households with a R10 000+ monthly household income. While that is only 30% of the population, they do make up 80% of the country’s taxpayers and dominate consumer spend in the formal economy. And, having held back the 2021 survey until consumers were free from severe restrictions, BrandMapp is now in a unique position to provide a trended view of this segment of South Africans and reveal how they are thinking and behaving in the new COVID-19 reality, compared to the “carefree days” preceding the pandemic. Explains De Kock: “Consumers have gone digital and tried out new delivery modes, as well as switched brands and relentlessly shopped for value. There’s talk of the ‘homebody economy’ firing up DIY, hardware and gardening sales; and the ‘nesting economy’ that’s emerged from our focus on our home-bound creature comforts. When it comes to this radical disruption of our shopping habits, it’s hard to get a handle on what’s really happening with South African consumers, and where we’re heading.”

One thing stands out from the research: South Africans who kept their jobs and are still relatively financially stable, or even better off in some instances, are desperate to go back to whatever ‘normal’ was before. Here are 10 things from the current BrandMapp roadshow:

1. Online bonanza

Lockdown has been the most significant, gamechanging disruption to middle-class South Africa’s shopping habits and rituals. BrandMapp 2021 reveals that 93% of respondents to this survey shopped online – a significant uptake over 2019. De Kock adds, “What’s notable is to draw the distinction between traditional online shopping categories such as fashion, books and electronics – that we’ve been increasingly comfortable supporting for the past few years – versus provisioning online, which is about buying your usual food and grocery items, favourite wines and other necessities. It’s in provisioning where we saw an incredible boom in the ecommerce space. Movement restrictions, alcohol bans and health anxieties drove unprecedented numbers of South Africans online to get the basics of life. In the process, many have now learnt how to do online shopping, and have had the chance to get really good at it. They’ve also experienced the joys of grocery and alcohol deliveries to their doors. People are not going to want to revert to queues, they will keep the experience. It is not a threat, but an opportunity for the industry.” There have been huge category shifts in the increase by this segment in buying groceries online (from 9% previously to 18% in 2021) and alcoholic drinks (11% to 19%) post-Covid. Woolworths reported a 158% increase in online grocery sales. As De Kock points out: “Consumers are getting better at provisioning. I predict this is a trend that is set to stay.”

2. Shopping mindsets

Consumer mindsets haven’t shifted much over the past year under lockdown. The three top mind-states are still: 57% of SA mid to top-income shoppers prioritise price through sales and discounts; 45% are loyal to brands they know and trust, and 44% say that quality is more important to them than convenience.

3. Saving cash

It’s a sign of the times that saving cash is top of most people’s minds. The pandemic might have made things worse, but the economic concerns which prompt price-driven behaviour have certainly pre-dated Covid in the country.

4. Quality counts

The concepts of brand loyalty and quality over convenience are also not new priorities for SA shoppers, though WhyFive observed a hiked response to quality in 2020, which is likely to have been pandemic-driven. Home-bound and facing a global health crisis, consumers have been thinking more about the food they are eating and noticing more about the quality of things in their homes.

5. Resilience is my middle name

What did 2020 do to the income of South Africa and has the middle class been pulverised by 2020, is a question retailers want to know. “The middle class, the taxpayers in SA, were more resilient during lockdown than people thought they would be. That is a good news story. That top 30% has been super resilient. According to the quarterly labour force survey, we lost about 3 million jobs under lockdown, but we have 2.4 million of them back in the formal sector,” De Kock says. And of the 5 million people who pay 98% of all personal tax, only 3% dropped out of their tax bracket. “But, overall, 682,890 taxpayers have been lost between 2019 and 2020 – representing R90 billion in lost tax revenues; as 23% of people earning between R7k and R10K a month dropped off the chart – that is where the real pain is in the economy.”

6. The way we were

When will we get back to wherever we are going to end up? This is the question this consumer segment wants an answer to. Brandmapp found that while consumer behaviour is not back to normal, patterns of behaviour are normalising. This is evident from increased traffic congestion in our cities and new car sales, which were only 13% down from February 2020 when compared to February 2021, with 37,521 cars sold in that month.

7. Not much has changed

In asking consumers how bad their 2020 was, 30% of people said they had someone close to them die of Covid; 13% lost most of their income due to COVID-19; and 6% lost their job. But in many ways, not much has changed at all for this crucial group of consumers. The percentages for whether they are better or worse off don’t differ radically from 2019 and 2020. The vast majority of the middle class desperately want life to go back to the way it was and the way they want to behave is exactly as before – they haven’t changed banks or medical or their car buying habits. The figures show almost the same trends from 2019 to 2021, De Kock pointed out.

8. Clinging to hope

Good news for restaurants is that 31% of consumers say they see themselves eating out at restaurants about once a month next year. This is compared to pre-Covid when 30% of people said they ate out at restaurants once a month. “The moment people don’t feel threatened in anyway, they will go back to eating out.”

9. What keeps us up at night?

“We were, and remain, a very traumatised country. We ask the same questions every year: ‘Which of these things keep you awake at night…’ Crime is still at the top,” says De Kock. In fact, South Africans are still more worried about crime and corruption than the current plague we are all living through. This is what they worry about: crime 60%; corruption 54%; Covid/global pandemics 45%; Government incompetence 45%; the future of my children 44%; weak economic growth 43%; rising poverty 41%; and rising food and energy costs 38%.

10. We found our humanity

There was significant change from the pre-Covid study released in 2020 to 2021 in relationships and health: there was a 17% increase in people who stated it was important to keep in touch with friends (to 67%); and a 10% increase in those ticking the statement, ‘Being fit and leading a healthy lifestyle is important’ (to 59%). “I think lockdown really made us look in the mirror. We definitely have had some kind of compassionate shift. It was good for making us all a little bit more human,” says De Kock.

*These insights were also presented in partnership with Telmar.

Main image credit: Photo by Alex Haney on Unsplash.

– Receive the Retailing Africa newsletter every Wednesday • Subscribe here.