CHANNEL MASTERY + SIA WEEKLY CONSUMER BEHAVIOR PULSE – June 25, 2020

Last Friday, June 19, 2020, the Senate passed the Great American Outdoors Act (GAOA). The bill is now headed to the House, then hopefully onto the president’s desk. If passed, this would be a BIG win for the outdoor recreation industries! The bill fully funds the Land and Water Conservation Fund, addresses the backlog of public lands maintenance, supports rural communities dependent on public lands and tourism, and rescues the outdoor recreation industry, which is made up of 90-percent small businesses.

This comes at a critical time as national parks are re-opening, and consumers are starting to feel more comfortable traveling. Starting is the key word here. The U.S. Travel Association is reporting an increased interest in travel, but consumers are still playing it safe. They are choosing to stay closer to home, travel by car or RV, and visit what they perceive to be safer destinations, like national parks and public lands. 

The US Travel Association published a report on June 18th showing a considerable increase in the likelihood of people participating in travel activities. After dipping last month, there is a rising intent to stay in a hotel or resort in the next six months; 38-percent now say it is likely they will do so, compared to 31-percent in May. There are caveats though. Among Americans who are expecting to travel in 2020, most say they will avoid: 

  • Crowded destinations (53-percent) 
  • Attending conferences (46-percent)
  • Air travel (34-percent) 
  • Cities/urban areas (25-percent)

Those surveyed, intend to: 

  • Visit a more familiar destinations (60-percent) 
  • Visit destinations with better “pandemic etiquette” – destinations perceived as safer in terms of COVID-19

Travel Pulse reports a similar sentiment, travelers are looking to maximize experiences while minimizing risk. Travel Pulse predicts increases in: 

  • Road Trips and RV Travel
  • Visits to America’s national parks and public lands 
  • Staycations 
  • An increase in travelers purchasing travel insurance and booking with hotels, airlines, etc. with flexible booking and cancellation policies 

SIA Take: The uncertainty and insecurity brought on by COVID-19 is driving a desire for flexibility, familiarity, and safety. There is so much changing around us, and so much uncertainty in the future, that consumers want to travel, but they want to do it in their own car, close to home, to familiar destinations, and safe spaces. This sounds a lot like the re-opening of retail spaces and restaurants. People are increasingly open to stepping in a store or restaurant, but are more likely to do so if it is perceived as safe, and easy.

 

Incremental increases in traveler spending and confidence is met with increases in consumer spending, as reported by the NPD Group. The NPD Group is a leading provider of sales tracking data – covering stores and e-commerce. Insights from their weekly report show: 

  • A 3-percent increase in general merchandise sales, compared to last year.
  • Highly discretionary industries in fashion – like apparel, footwear, beauty, accessories, and watches – have shown marked improvement compared to late March when stores first shuttered. 
  • Total retail purchasing traffic, as measured by the number of receipts, continued to rise for the week ending June 13, nearing the pre-crisis baseline. Online receipts leveled off as in-store receipts grew.

The NPD Group has also been tracking trends in the sports industry. A recent NPD Checkout survey found that exercising at home has increased more than 70-percent, since COVID-19, and twice as many consumers are using online or app-based exercise classes. 

Matt Powell, Vice President and Senior Industry Advisor at NPD, expects that “we will see a renewed and heightened interest in wellness and fitness post-pandemic.” 

Powell continues: “In addition to the lockdown providing a greater incentive for people to exercise at home or be active in the open air, I believe this illness has also motivated people to adopt healthier habits. Overall, I expect the combination of these factors to drive an increased interest in healthy lifestyles, which bodes well for sports retail.”

Even as stores begin to re-open, research shows that consumers are still leery. Research conducted by Civic Science, a NPD partner, found that: 

  • Customers who like to shop at Academy, 25-percent say they would be comfortable shopping there in one to four months, and 50-percent say in more than four months. 
  • For customers who like to shop at Footlocker and The Finish Line, about 40-percent say they will shop there in one to four months, and about 30-percent say more than four months. 
  • Dick’s Sporting Goods has the most favorable outlook, with about half saying they would shop soon and 30-percent saying in one to four months. 

SIA Take: This shows a long and bumpy road to the recovery of physical retail spaces. To thrive, retailers and brands MUST keep flexibility in mind when serving consumers, and up-level e-commerce platforms. In addition, retail will need to constantly showcase that safety is top of mind, and make consumers feel comfortable and at ease. Two ways to help consumers feel at ease: offer curbside pickup, and continue to communicate and build relationships with them. Even if they are not physically visiting your store right now, consistently communicating with them will make them want to visit when they are ready. 

 

More to come next week. Please let us know if there’s something specific you’d like for us to include in our weekly Consumer Behavior Pulse – email [email protected] to send your request. Thanks!

Colleen Nipkow

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