US consumer sentiment and behaviors during the coronavirus crisis

US consumers started spending at increased rates in Q2 2021, giving shape to the next normal.

Given the recent surge of the Delta variant, we will continue to track changes in consumer sentiment and behavior as the next normal continues to evolve.

US consumer spend recovered in Q2 2021, driven by the confluence of increasing vaccination rates, stimulus payments in March 2021, an optimistic outlook toward economic recovery, and the general reopening of the economy. Consumers’ pent-up demand and willingness to spend in some discretionary categories caused spending to grow at 20 to 30 percent year over year, reaching 4 to 7 percent above pre-COVID-19 levels. While lower- and middle-income consumers drove much of the spend increase through the spring of 2021, we now see a change, with the recent increase coming primarily from higher-income groups.

Dotcom step change has stuck. E-commerce sales continue to experience outsized growth, with online penetration remaining approximately 35 percent above pre-COVID-19 levels, and e-commerce showing more than 40 percent growth over the past 12 months. At the same time, brick-and-mortar spending on retail categories has stayed relatively consistent during this whole period.

Disparate recovery across categories. Despite overall spend growth, retail channels have evolved into clear groups of spend performance, ranging from those experiencing continued large declines (including out-of-home entertainment such as theaters and amusement parks) to those seeing sustained elevated growth (such as spending on the home).

Channel and category performance has evolved into five distinct performance types over the course of the COVID-19 pandemic.
We strive to provide individuals with disabilities equal access to our website. If you would like information about this content we will be happy to work with you. Please email us at: McKinsey_Website_Accessibility@mckinsey.com

Loyalty shakeup continues. Consumers are again adjusting their behavior as the economy reopens. As many as 30 to 40 percent of consumers continue to switch brands or retailers, driven primarily by younger consumers seeking value, combined with greater emphasis on purpose-driven alignment and quality.

Value is the main reason consumers have switched brands since the start of the COVID-19 pandemic--other reasons include purpose, quality, and novelty.
We strive to provide individuals with disabilities equal access to our website. If you would like information about this content we will be happy to work with you. Please email us at: McKinsey_Website_Accessibility@mckinsey.com

Homebody economy persists. Consumers and employers are adjusting to a “next normal” in remote work models. In addition to increasingly hybrid work models, we continue to see a corresponding shift in purchases and investments focused on home-based working and living. We expect to see this trend continue in the medium term.

Consumers have made life changes that have increased the stickiness of the homebody economy.
We strive to provide individuals with disabilities equal access to our website. If you would like information about this content we will be happy to work with you. Please email us at: McKinsey_Website_Accessibility@mckinsey.com

These exhibits are based on third-party data provided in the United States between February 2019 and June 2021, as well as longitudinal surveys conducted between March 2020 and February 2021. Check back for regular updates on US consumer sentiments, behaviors, income, spending, and expectations.

Related Articles