Monday, 16 March 2020

Wealthy Chinese consumers feel worst of coronavirus is over, but still not back to normal

As Europe and the Americas reel from the spread of the coronavirus, consumers in the first country to suffer its effects — China — are starting to get back to some semblance of normality. They’re feeling better about their situations, although some reservations remain.

Luxury research specialist Altiant conducted an ongoing study among 252 high-net-worth Chinese consumers, located mainly in tier-1 cities such as Beijing, Shanghai, Shenzhen, and Guangzhou. It asked them five short questions regarding their opinions about the coronavirus outbreak and how it's affecting their lives.

Two questions established if respondents thought that the worst of the health and commercial impacts of the virus outbreak was behind them and their community. That's an important point to make given how much their attitudes will affect their willingness to start spending again.

“Positively, we are now seeing more respondents report that the worst of the health effects are behind them than ahead of them,” Altiant said. “On the commercial side, naturally there will be somewhat of a lag before consumerism and commerce return to normal. On this front, 40% of respondents said the worst of the commercial effects are behind them”.

Unfortunately for retailers that are reopening their Chinese stores, as many as 56% of those questions said that the worst effects aren't yet behind them, which is clearly likely to affect their willingness to shop.

Altiant also wanted to see when they thought life would more or less return to ‘normal’, and their answers to this question were far more encouraging. Some 81% of respondents believe that a sense of normality will return to their communities “in three months or less, which at the time of data collection would mean before early-to-mid June”.

In fact, as many as 26% believe that they will be getting back to normal within a single month. 

But any return to normality won't leave them completely untouched by the psychological after-effects of the virus. About 70% of the sample reported that this viral outbreak “will either significantly or somewhat negatively affect their personal economies”. This could mean lower spending over the next few quarters.

The final question was an open-ended one, asking if there was anything at all that they would like to see luxury companies do to help their community return to normality. The replies showed a mixture of consumers wishing to get back to a shopping focus quite quickly, but also wanting to ensure that companies are trying to do some good in their communities.

Answers included companies producing luxury branded masks and/or donating medical grade masks, as well as donating to other relevant causes like vaccine research.

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