As anxieties about the spread of the coronavirus deepen, consumer confidence is also weakening. But some shoppers are still scooping up new clothing and shoes online.
According to insights released last week by Coresight Research, more than half of surveyed shoppers characterize their feelings about the outbreak as “extreme concern,” up nearly 7 percent in just one week.
About one in 10 respondents said they had already lost their jobs due to the virus, similar to about 9 percent the week before. This week, about 41 percent said they were fearful of losing their jobs or a portion of their incomes, down 5 percent from the week before.
Analysts describe discretionary spending as taking major hits due to the malaise, with apparel sales suffering the most. The number of consumers cutting back on spending on their wardrobes has increased week over week, analysts said, mostly due to the spate of store closures that has rocked the nation’s retail sector.
Despite the heavy analysis, experts pinpointed one potential bright spot: e-commerce.
The crisis has driven shoppers away from brick-and-mortar and back to the safety of their home offices and couches, making online shopping an attractive option for those who are still inclined to spend.
The good news? A substantial portion of those buying more online are spending on apparel, Coresight Research analysts said. However, the number of shoppers converting online isn’t enough to recoup the sales lost through store closures.
Should the trend continue, though, online spending could be an avenue for keeping brands and retailers afloat.
Payment solutions provider Klarna, which allows shoppers to pay for their online and in-store purchases in installments, released data showing that Gen Zers, millennials and Gen Xers bought more clothing and accessories on the platform than any other category last week. Klarna’s payment plan platform is used by seven million shoppers and 4,000 retail partners in the U.S. alone.
“We’ve found that U.S. consumers are really focusing their e-commerce shopping on clothing, shoes and accessories as they weather this difficult period,” Klarna CEO Sebastian Siemiatkowski said in a statement.
“For retailers and brands, the data may indicate that shoppers are choosing to buy comfortable items to work from home in as well as workout wear that will get them through the next several weeks of exercising in their living rooms,” he added, noting how flexible payment options are giving them the confidence to make these purchases during a period of uncertainty.
In addition to spending on apparel, footwear and accessories, young consumers are also spending on home and garden items, suggesting a desire for personal comfort and pleasing home environments that will allow them to make the most of their time spent largely indoors.
Data from March 28 showed that apparel, footwear and accessories sales on Klarna increased 18 percent among Gen Zers week over week. Spending on these categories jumped from 44 percent in the week of March 21 to 52 percent in the week ended March 28.
During that same time period, spending increased 13 percent among millennials, from 32 in the week of March 21 to 36 percent in the week of March 28.
The smallest increase in footwear, apparel and accessories spending was seen in Gen Xers, who still increased their shopping for these items by 4 percent. These categories accounted for 26 percent of the volume of Gen Xers’ purchases in the week of March 21, and grew to 27 percent in the week of March 28.
By contrast, Klarna analysts said, sales in categories like leisure, sports and hobbies, as well as “intangible products” like event tickets and travel, fell week over week among all three generational cohorts.