New research from Roy Morgan shows that the COVID-19 pandemic has had a big impact on key financial and buying attitudes with a surge in those willing to use credit to buy the things they want. want, who like to be well insured, who go out of their way for a bargain and more.
In the 12 months to March 2021, a rapidly rising 38.8% of Australians agree that “Credit allows me to buy the things I want” – an increase of 12.4 percentage points compared to a year ago before COVID-19. This is the largest increase for any of the financial attitudes covered here and suggests that the long-term decline in credit use is reversing as alternative payment systems such as Zip and Afterpay enter the market. the market.
The COVID-19 pandemic has also had a big impact on how Australians go about their banking and more than three-fifths (60.1%) now agree “It would be ideal if I could do all my banking without ever having to go to a branch” – an increase of 9.8 percentage points compared to a year ago before COVID-19.
Stay-at-home orders and the potential risk of catching COVID-19 while traveling in the community have clearly diminished the appeal of waiting in long lines at the local branch when the ease of use of websites and applications to perform banking transactions is easier than ever.
There is also good news for insurers with over three-quarters of Australians, 75.5%, now agreeing that “I like to be well insured” – an increase of 6.2 percentage points compared to a year ago before COVID-19.
There are other attitudes that COVID-19 has had a lesser impact on.
Today, 67.2% (up 4.3% from a year ago) of Australians say “Recently, I have reduced my expenses”and slightly less, 57.6% (down 2.1 percentage points) agree that “I feel financially stable at the moment” – both movements in the negative direction but not as significant as one might have feared a year ago.
The financial impact of COVID-19 has not shaken people’s confidence in their own financial management with virtually unchanged 73.5% of Australians saying “I feel confident in managing my finances.”
The data comes from Roy Morgan Single Source, the nation’s largest and longest-running research program on consumer behavior and attitudes, conducted continuously throughout the year.
Top Financial Attitudes: Pre-COVID-19 (March 2020) vs. During COVID-19 (March 2021)
Compared to pre-COVID, Australians are more likely to shop for a bargain and try new brands.
COVID-19 has clearly had an impact on Australians’ attitudes towards how they shop, and nothing more significant than increasing the bargain-seeking instinct of many. Today, a clear majority of 56% of Australians say “I’ll go out of my way looking for a bargain” – an increase of 11.9 percentage points compared to a year ago before COVID-19.
Starting from a low base, there are now 18.2% who claim to have been ‘born to shop’, an increase of 7.5 percentage points from a year ago before COVID-19. The strong retail sales figures over the past year since the introduction of the $89 billion JobKeeper wage subsidy, the JobSeeker rate hike and the $36 billion Superannuation Withdrawal Scheme dollars propelled ABS retail sales numbers to record highs since May 2019.
ABS’s latest retail sales figures for April 2021 showed retail sales at an all-time high of over $31 billion, or more than $1 billion a day.
Australians are also increasingly looking for new brands with 56.6%, up from 5.7%, according to “I am always ready to try new and different products” although also more cost-conscious than before the pandemic with nearly half, 44.7% (up 5.9 percentage points) saying “I buy more products from the store than from known brands”.
Top Buying Attitudes: Before COVID-19 (March 2020) vs During COVID-19 (March 2021)
Commenting on the results, Roy Morgan CEO Michele Levine said: “The COVID-19 pandemic caused a huge shock to the Australian economy and way of life at the start of 2020 and these effects continue to persist with attitudes towards many financial issues and buying behaviors. changing.
“Now more than three-quarters of Australians (75.5%) said they ‘liked to be well insured’, a significant increase of 6.2% from the pre-pandemic period. The way Australians do their banking has also been heavily impacted, with 60.1% saying, “It would be ideal if I could do all my banking without ever having to go to a branch” increase of nearly 10% in just one year.
“The desire to handle all financial affairs without visiting a branch is a long-standing trend that COVID-19 has accelerated as website and app banking increasingly becomes the norm.
“However, perhaps the most interesting trend over the past year has been the sharp rise in the number of Australians saying ‘credit lets me buy the things I want’ – now at 38.8% ( up 12.4% from pre-pandemic).
“This is the biggest increase for any financial attitude and suggests that new forms of ‘credit’ such as ‘buy now-pay later’ Zip and Afterpay services are now driving a change in these attitudes alongside financial challenges. driven by the pandemic. Roy Morgan’s latest digital payments report shows 72.4% of Australians are aware of ‘buy now, pay later’ services, nearly double the figure of 36.9% in less than three years at the end of 2018 .
“The growing adoption of new digital payment services that defer immediate payment is playing into changing shopper attitudes. Today, more than half of Australians (56%) say “I will do my best to find of a good deal” – an increase of 11.9% compared to the pre-pandemic period.
“Shoppers are also looking for bargains in general with 56.6% (up 5.7%) saying ‘I’m always up for trying new and different products’ and 44.7% (up 5.9 percentage points) saying ‘I buy more of my own products than well-known brands’.
“Overall, the changing attitudes of Australians are driven not only by the enforced restrictions of the COVID-19 pandemic with lockdowns and stay-at-home orders, but also by the increasing availability of new technologies that enable operations banking and frictionless purchases without having to even leave home.
“COVID-19 has accelerated these trends, which were already evident before the pandemic, and they present both great opportunities for finding new channels to reach potential customers, as well as challenges for old ways of doing business. .”