Boston Consulting survey: Victoria’s virus success lifts consumer confidence

More consumers are returning to their normal spending habits, boosting confidence for a robust Christmas trading period.

The latest consumer survey by Boston Consulting Group finds 39 per cent of Australians have returned to their normal spending habits, with 30 per cent planning to step up future discretionary spending. Picture: Getty Images

An uplift in consumer confidence is driving hopes for a robust Christmas retail season, despite economic fears about the coronavirus persisting for most Australians.

The latest consumer survey by Boston Consulting Group finds 39 per cent of Australians have returned to their normal spending habits, with 30 per cent planning to step up future discretionary spending.

The survey was conducted from October 30 to November 5.

“There was an increased intention to spend over the next six months,” BCG managing director and partner Monica Wegner told The Australian.

“Before it was more essentials. We’ve seen a big lift in intention to spend around leisure travel; that’s up 29 per cent on a net spend basis. Out-of-home entertainment like concerts and theme parks is also up 29 per cent.”

Despite the consumer optimism, luxury brands faced persistent challenges, with just 16 per cent of consumers expecting to spend more in the category in the next six months.

The survey revealed persistent fears about economic recovery. Of those surveyed, 78 per cent were concerned about the economic recession and 45 per cent about their personal finances.

“People are realistic about the fact that there are still impacts on the economy from the ever-evolving virus but then of course also borders are still closed internationally,” Ms Wegner said.

The report highlighted a growing divide between men and women, with women more pessimistic about the recession.

Ms Wegner said the report highlighted the acceleration of online shopping was here to stay, but consumers often opted to shop in-store for food, electronics and appliances.

“In-store shopping and out-of-home entertainment has increased since July, which is not at the expense of online shopping but in addition to online shopping,” she said.

“Ultimately those in-person experiences are still 30-40 per cent below normal level.”

Ms Wegner said that companies needed to ensure they were tailored to customer’s needs in the online shopping environment.

“Consumers tell us where they‘ve found online shopping to be convenient is where there is good value for delivery costs as part of the overall package of buying online,” she said.

“The companies who do this have invested in a great experience for consumers online and careful consideration of what they are willing to pay.”

The survey also found Victoria’s lockdown led to more Australians feeling optimistic about curtailing the virus. The number of consumers nationwide who believed the worst is still ahead fell to 39 per cent, compared to 48 per cent in July.

A resurgence in consumer sentiment was also highlighted by the latest Australian Bureau of Statistics’ retail data, which showed a 1.6 per cent rise in turnover in October.