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INDUSTRY INSIGHT SHOPPER VIEWS CAPTURED AT DISRUPTION PEAK Among revelations from surveys taken in March and April, Australian shoppers and households are shown to be pessimistic about the severity and duration of the COVID-19 pandemic’s economic damage. IBy IRI Insights Director Daniel Bone. RI’s ‘COVID-19: The Australian Consumer & Shopper Perspective’ report combines multiple sources of data and research inputs to provide a comprehensive view of the behaviour and perceptions of shoppers throughout March and the first half of April. It therefore captures changes during an unprecedented time of travel restrictions and border control measures, the shutting down of non- essential services amid stricter social distancing restrictions, and economic stimulus packages. Then there was, of course, unprecedented pantry stockpiling as consumers were consumed by the ‘anguish of ambiguity’ and the ‘fear of running out’. The unique magnitude of the COVID-19 outbreak is apparent from two crises playing out concurrently (unlike the financial crisis in 2008-09). There is the virus itself and the economic downturn it could prompt. Our research reveals that most Australians are bracing for more than a year of economic impacts and appear to believe the collateral damage economically will be longer lasting than the health crisis. Interestingly, Australians are more pessimistic than Americans about the duration of both facets of the crisis. Expected length of health and economic crisis Our Australian panellists were already pessimistic about their financial situation in 2019, influenced by record levels of debt and anaemic wage growth. In April 2020, 48 per cent rated themselves as being ‘worse off’ in 2020 versus a year ago. Nearly the same proportion (45 per cent) of households indicate having seen income compromised by COVID-19 control measures. This aligns with those experiencing reduced hours and job losses (46 per cent). Financial situation changes vs YA and employment situation Most households are not maintaining regular spending, and just one in seven households expect it to normalise when the economy improves. Less than 20 per cent anticipate their finances improving in a year. Consumers report a stronger focus on finding the best deal at a time when just over a third of households report experiencing grocery affordability challenges. Now is the time for the FMCG industry, and indeed consumer facing industries countrywide, to begin anticipating what the recessionary world (and country) will look like. Recession-resilient companies must maintain loyalty among high-value customers, optimise advanced analytics, and focus astutely on operating costs. This ‘recessionary mindset’ provides an ideal backdrop for accelerated private label development given the inherent price advantage such products typically command. Household situation changes Lifestyle routines have altered for more than 95 per cent of Australian households surveyed. Arguably the most significant challenge in dealing with the restrictive lifestyle of isolation is the emotional burden and frustration that sets in from a loss of control and choice. Key feelings expressed from more than 5,000 of our shopper panellists were around being stressed, anxious, worried, lonely, depressed, frustrated and even angry. Sixty-three per cent expressed concern regarding the lockdown length. Forty-one per cent are responding by doing more to proactively take care of their physical and emotional health, compared with just six per cent who report doing less. Lockdown duration Only 18 per cent of surveyed 18 RETAIL WORLD JUN, 2020