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Consumer Behavior During COVID-19

  • Alliant & Wiland
  • Dec 2, 2020
  • 7 minute read

About the Alliant DataHub
Alliant is a cooperative database. The DataHub gathers transactional data from over 700 product and brand categories, reflecting consumer behavior across 250 Million US consumers. DataHub Members update their data at regular intervals, providing a comprehensive view of consumer behavior that is transformed into powerful predictive data elements and ultimately high performing audience, enrichment and optimization solutions to activate in any channel.

About Wiland 

Wiland is the best predictor of consumer response. By applying advanced predictive analytics to the largest set of individual-level U.S. spending data and interest-intensity signals, Wiland enables brands and their agencies to find the people ready to spend with them immediately and to make repeat purchases at a high rate. Wiland also has the largest donor database in America that fuels audience products to help fundraisers acquire new donors and optimize relationships with existing donors.

Last March, millions of Americans began to adjust their everyday behaviors in response to COVID-19. So did advertisers that needed to find new consumer marketing strategies, as they watched their revenues either rise or decline depending on their product categories and subcategories and evolving consumer sentiment.

Leading audience solution providers Alliant and Wiland have both been analyzing their data assets to highlight pandemic-related buying trends from March-September 2020. They identified trends in purchase frequencies, order size, new customer acquisition and more. 

Consumer Buying Trends

Food & Beverage subscription and home delivery services, Beauty, Crafts, and Children’s & Educational products are categories that have outpaced customer acquisition rates compared with the same time period in 2019. However, even as these verticals attract new customers, the average order size is down, indicating that these customers are not spending as much as pre-pandemic customers.

Meanwhile, the Publishing and Multichannel Retail verticals saw declines in customer acquisition from March-September 2020 compared to the same timeframe in 2019.

Here are some of the trends that Alliant and Wiland have identified as being impacted by COVID-19 within vertical and marketing channels:

Food & Beverage Industry and Order Sizes

Food & Beverage programs, including grocery delivery and subscription boxes, experienced some of the strongest organic growth, driven by stay-at-home orders and related factors. Consumers needing new ways to purchase food leaned into these services, increasing activity in this category. Wiland measured retail activity in the space including the number of buyers, orders and items, observing a 10.5% increase in activity for March-September of 2020 compared to 2019. 

Alliant saw an 84% increase in new consumers from March-June, compared with the same time period in 2019. Unlike other categories, Food & Beverage saw a 46% increase in the average order amount per new customer and a 117% increase in total sales from new customers. New customers in this category are slightly older and have 8% lower income on average compared to new customers acquired in 2019. 

Direct-to-Consumer Multichannel Retailers Acquisition and Order Size

Direct-to-consumer (DTC) Multichannel Retailers of general merchandise saw a 15% drop in new customer acquisition compared to March-June 2019, but some specific category retailers did very well.

Computer and accessories retailers as well as women’s and unisex apparel saw increased order activity compared to 2019. Despite retail activity for beauty and craft retailers that was lower in March-June in 2020 compared to 2019, both categories did see increases in new customer acquisition. DTC beauty retailers saw a 77% increase in new customers and DTC craft retailers saw a 118% increase. However, these new quarantine customers and existing customers are spending less, with a 4% decrease in average order amount per customer, which is a factor in lower order activity across the category. 

Publishers, in general, struggled with new customer acquisition, seeing a 4% decline in new customers compared to the same time period in 2019. Some did see strong gains during quarantine, however, including religious, educational and children’s content publishers. From March–July 2020, Wiland saw children’s educational materials grow by 120% compared with that same time frame in 2019.

Marketing Tactics and Trends During COVID

Email leads to twice the number of customer acquisition and total order volume. New customers attributed to email campaigns were up 177% year over year. Customers acquired via email also spent more with a 35% increase in average order amount per customer. Email customers are increasingly from urban areas and are 10% more likely to have children.

Direct mail rides high, then falls off. New customer acquisition via direct mail was booming in the early quarantine months, up 16% in April and 26% in May, then experienced a sharp decline in June with 56% fewer new customers compared to June 2019. This shift is a result of some marketers pulling back on mailings as the pandemic impacted their budgets. Mailings that dropped in March and early April could not be stopped, and thankfully they performed well with consumers quarantined at home. 

The silver lining in direct mail was that the average order size maintained positive growth throughout the pandemic. Average order size of new customer purchases was up 18% in March (2020 vs. 2019), 15% in April, and 31% in May before dropping to only 8% in June. The average order amount for a direct mail order was actually 93% higher than the average order for an email offer, and 153% higher than an online ad order, showing that direct mail is still worth the investment in these troubled times.

New customers acquired via digital advertising (including display, video, paid search and social) were up 36% and had a 11% higher average order amount per customer over 2019.

TV sourced orders were up 84% for new customers from March-June with a 41% increase in average order amount per customer. 

Explore Your Quarantine Data

Understanding these quarantine behaviors can help marketers better leverage their first-party data. Isolating new customers who purchased for the first time during quarantine and comparing them to your existing customer base will help illuminate differences, but also find ways for brands to engage with these new customers. Since they became customers in unique circumstances, they will most likely require a unique approach for retention and building lifetime value.

Planning for 2021? Now is a great time to do this exercise. Reach out to the experts at Alliant and Wiland for more ideas on how to assess your customer data and harness that insight for growth. 

Quote from Donna Hamilton, SVP Data Acquisition, Alliant

“The quarantine buying behavior supports how important it is to connect directly with consumers during challenging times, and how DTC companies are in a unique position to build relationships with new and existing customers. Marketing efforts should hold steady or increase during these times, not be held back.”

Quote from Emma Nicoletti, Director of Analytics, Wiland

“If there can be good news during the pandemic, it’s that consumers are still spending—just in different ways and categories than before. At Wiland, we’ve been observing new patterns in how consumers shop, spend, and interact with brands. And it’s those brands that are able to reach active consumers who are ready to buy now and provide high long-term value in the future–they will be poised for success as the pandemic ends.”

Are you looking to learn more about marketing and customer retention trends to keep growing your business? Join SUBTA. We’re a community of doers, excited to share insights, make connections and grow your subscription brand.