Consumer Behaviour during Crises: Preliminary Research on How Coronavirus Has Manifested Consumer Panic Buying, Herd Mentality, Changing Discretionary Spending and the Role of the Media in Influencing Behaviour

Abstract

The novel coronavirus (COVID-19) pandemic spread globally from its outbreak in China in early 2020, negatively affecting economies and industries on a global scale. In line with historic crises and shock events including the 2002-04 SARS outbreak, the 2011 Christchurch earthquake and 2017 Hurricane Irma, COVID-19 has significantly impacted global economic conditions, causing significant economic downturns, company and industry failures, and increased unemployment. To understand how conditions created by the pandemic to date compare to the aforementioned shock events, we conducted a thorough literature review focusing on the presentation of panic buying and herd mentality behaviours, changes to discretionary consumer spending as defined by Maslow’s Hierarchy of Needs, and the impact of global media on these behaviours. The methodology utilised to analyse panic buying, herd mentality and altered patterns of consumer discretionary spending (according to Maslow’s theory) involved an analysis of consumer spending data, largely focused on Australian and American markets. Here, we analysed the volume and timing of consumer spending patterns; the volumes of spending on specific, highly-demanded consumer goods during the investigative period; and the distribution of spending on luxury and non-durable goods to identify the occurrence of these consumer behaviours. Moreover, to identify the presence of the media in influencing consumer behaviour we focused on web traffic to media sites, alongside keyword and phrase data mining. We conclude that, to date, consumer behaviour during the COVID-19 crisis appears to align with behaviours exhibited during historic shock events. We hope to contribute to the body of research on the early months of this pandemic before longer-term studies are available.

Changes in Consumers’ Food Practices during the COVID-19 Lockdown, Implications for Diet Quality and the Food System: A Cross-Continental Comparison

“…However, changes in consumers COVID-19 related practices, e.g., having difficulty finding ingredients and bulk buying, and emergency situation food practices, including organisational and management, were seen alongside the other regions. These behaviours have been seen previously in “shock” events such as earthquakes [ 43 ], however, the widespread media and instant connectivity of social media coverage may have intensified psychological responses such as coping mechanisms for stressful unmet situations, easing of anxiety to maintain routine, loss of control, and conforming to social pressure [ 44 , 45 , 46 ]. While there were some region differences, with the widespread media coverage across all regions, it is understandable to see these changes within all the regions.…”

Online Shopping Motives during the COVID-19 Pandemic—Lessons from the Crisis

“…During the pandemic, consumers have been exposed to a large amount of information and a vast number of media reports [15]. We argue that in this particular situation, there has been a high degree of insecurity in the German population regarding the economic consequences of the crisis [52].…”

“…Recent studies on consumer behavior during the COVID-19 pandemic validate this approach and show that the pandemic alters consumers' decision-making and behavior. In early stages of the pandemic, consumer behavior echoed the behavior observed in previous historic shocks and led, for example, to panic buying [15]. However, the ongoing uncertainty evoked by the pandemic may lead to transformative consumption patterns in the long term [36].…”

“…However, the COVID-19 pandemic represents a unique situation, and determinants beyond those involving utilitarian and hedonic motives must be considered. During the crisis, there has been a high degree of media coverage relating to the pandemic, and consumers are exposed to a large amount of information regarding the current economic situation [15]. The current crisis reveals the need to account for the normative influences of these authoritative third parties.…”

Innovative Perspective of Marketing Engagement: Enhancing Users’ Loyalty in Social Media through Blogging

“…Beginning of social media changed the relationship of this word of mouth communication into electronic word of mouth communication [13] where such communication changed the relationship between users engagement and its loyalty level. By observing the web trafficking and analytics, this media was found to be correlated with consumers' preferences by influencing their mentality even in the most tragic period [14]. Apart from these marketing efforts, users' wallet shares and purchasing power are also considered to be very important in relation to retention and loyalty.…”