You will be redirected back to your article in seconds
Skip to main content

COVID-19 Sparks ‘Homebody Economy’ in China. Will the US Follow?

As the COVID-19 spread intensifies around the world, China is finally finding some relief.

On Thursday, the country reported its second day without any new, locally transmitted cases of the disease.

Nearly two months of quarantine measures have forced the country’s citizens to stay home, as health officials work to contain the virus. That shelter-in-place mentality has also driven the “homebody economy” to new heights, a Nielsen study released Thursday revealed.

“Online shopping, online education and working from home have developed rapidly,” Justin Sargent, president of Nielsen China, said. “As such, consumers have quickly adapted to the situation in order to meet daily needs such as staying safe or for shopping, as well as for personal leisure.”

As containment has accelerated in recent weeks, consumer confidence has begun to improve. According to Nielsen’s study, nearly all (92 percent) of the Chinese shoppers surveyed expressed confidence China would emerge from the crisis victorious.

That assuredness stems from the hard-hitting preventative measures and controls put in place by the Chinese government early during the outbreak. Most consumers (82 percent) said they were bolstered by the transparent disclosure of information throughout the event.

As illness washed over the country, consumers were forced to work, study and ride out the disease behind closed doors. Most turned to online shopping for the essentials to fuel their daily lives.

Over the course of the past two months, the biggest demand was for everyday necessities and fresh products. Almost 70 percent of shoppers ordered these products more than twice a week, with 80 percent doing so online.

That shift in behavior could stick, Nielsen noted. The vast majority (89 percent) said they would be willing to continue purchasing this way after the pandemic is over.

Related Stories

Smart health products, like air purifiers, water purifiers and smart bracelets or fitness tracking rings have proven overwhelmingly popular with China’s online shoppers.

“We have seen China’s rising awareness of fitness for some time now, however increased health consciousness under this epidemic is markedly different,” Sargent said. “The current situation has quickly raised awareness of health concepts as well as tech-enabled health and fitness, breaking traditional boundaries and linking technology with this new home life situation.”

Brands and retailers that pivot quickly to respond to this emerging trend are likely to see gains, he said. “Hygienic and safe product concepts, as well as tech-enabled health, will help brands resonate with consumers during this period.”

The epidemic has also prompted a shift in the channels consumers are using to shop, providing both opportunities and challenges for brands and retailers.

“With the advent of 5G, AR, artificial intelligence, and a shifting market environment, brand owners should be continually embracing change while exploring new business strategies,” Sargent said.

Earlier this month, the firm released a study assessing the Chinese retail arena’s pitfalls, as well as areas for improvement.

In a survey of key retail companies and more than 10,000 traditional grocery stores, Nielsen found that while brick-and-mortar retailers faced setbacks, those that sprung to action quickly by providing new consumer efficiencies, like online ordering, turned the disruption into an opportunity.

“Like the retail industry’s changes in the SARS period, the consumption related to the industry is likely to rebound once the COVID-19 outbreak is over,” analysts said.

Nielsen research revealed that nearly half (46 percent) of the surveyed retailers were optimistic about business over the next half of the year after the pandemic releases its grip on the global economy.

Still, 36 percent of those surveyed said they were worried about the future and believed the operating pressure would increase.

Many retailers believe the COVID-19 outbreak has pushed China’s retail sector further into the digital age, and those new consumer expectations will stick long after this event recedes into memory.

More than three-fifths (67 percent) of retailers said they would continue to make efforts to expand online business channels, accelerate home-based business, and refine retail warehouse layouts.

More than half (53 percent) of respondents said they would alter their product mix to reflect the shopping habits of consumers. That means augmenting their supply of the inventory health, disinfection, and protection products.

More than two-fifths (43 percent) of retailers said the experience has prompted them to dig into their supply chains—especially for fresh food—and strengthen relationships with various brands while promoting efficient communication.