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Consumer confidence driven to ‘all-time low’ by Covid-19

Australians are moving from spending to saving, Queensland study finds

Shopping habits in Australia have changed in response to the Covid-19 pandemic and concerns about the possibility of a prolonged recession, according to a study by Queensland University of Technology in Brisbane. 

Gary Mortimer, a consumer behaviour analyst from the university’s business school, says consumer confidence is “at an all-time low” as a result of the pandemic.

“We are seeing a move from spending to saving, with 76 per cent of Australians pessimistic about the longer-term recessionary effects of the Covid pandemic,” he said in a university statement.

Small and micro-retailers are more likely to survive after the Covid-19 lockdowns because they can “adapt their business operations more rapidly than larger competitors”.

“Consumers are more frugal:  they ‘cocoon’, choosing to stay in rather than go out. They are cautious about their own and their family’s health. They cook at home, entertain at home, and engage in DIY rather than spending their hard-earned dollars outside the home.”

Mortimer said the Covid-19 lockdowns had changed consumer attitudes to online shopping, creating more trust in online retailers.

“Australians are now spending almost $32 billion online, or about 10 cents in every shopping dollar. Once shoppers have set up accounts, logins, credit card details and have gained trust, online shopping will become a habitual activity,” he said.

“It is estimated 80 per cent of us will be shopping online by next year and e-commerce will reach $35.2bn. Online shopping jumped by 21.8 per cent compared to the same time last year as Covid-19 restrictions took hold in March and retailers shuttered stores.”