According to GfK South Africa, only 21% of citizens were working as usual in Level 4 of the lockdown; 52% reported that prices of goods they usually buy are significantly higher than usual.

Unemployment and the economy have displaced COVID-19 as the top concerns for South African consumers as they experience the 'economic squeeze' after weeks of lockdown. This is according to GfK's new Consumer Pulse research. 

The report indicates that around 86% of respondents said they were 'extremely concerned about unemployment', compared to 80% in GfK’s survey during the Level 5 lockdown.

By comparison, 66% said they were extremely worried about COVID-19, down from 80% in Level 5, when the coronavirus was their top concern. Some 74% said they were concerned about an economic crisis during Level 4.

Among the respondents, only 21% reported that they could continue working as usual; 25% said they were working reduced hours and 7% said they had been retrenched. Nearly seven in ten (69%) said that their income has decreased. This is according to the study.

"While growing numbers of South Africans or members of their families have been exposed to COVID-19, larger numbers are directly experiencing the economic fallout of the virus and the lockdown," says Rachel Thompson, insights director at GfK South Africa. "With the majority of consumers reporting decreased income and higher prices, South Africans are feeling the financial pressure."

At the end of Level 4 of the lockdown, 69% of respondents reported that the economic situation in South Africa was worse than a year ago, up from 51% in Level 5. But the report indicates that they were optimistic that the economic impact would be short-term.

Fifty-one percent said that they and their families would be better off than today in a year, slightly down from 53% in Level 5.

According to the report, 70% of consumers reported negative feelings such as fear and sadness during the Level 4 lockdown; 43% said they were bored and 42% said that they were anxious.

Most (60%) said that they will maintain social distancing for a time or be very cautious in their social behaviour, with just 16% saying that they "can't wait to get back to all the things I did before social distancing regardless of any remaining risk." 

"Despite their eagerness to go back to the activities they love, consumers also appear to be resigned to deep change in their lives, [with] not much of it positive. Almost half (46%) told us they expect their work situation to be worse after the crisis and 68% expect many small businesses to close," says Thompson. "Most (79%) predict that working from home will become the norm."

Looking to life beyond the pandemic, consumers from the study reported they are looking forward to shopping (43%), dining at restaurants (47%) and socialising outdoors (49%).

Only 14% said that they would avoid going to physical stores and shopping malls; however, 27% indicated they would increase their usage of home delivery.

When it comes to e-commerce, consumers said they expected companies to offer free delivery (60%), fast delivery (64%), click-and-collect options (56%) and telephonic support (55%).

The study also indicates that hygiene and COVID-19 control measures, such as in-store disinfectant and social distancing, were their biggest expectations from offline retailers.

Many consumers additionally reported negative retail experiences during the Level 4 lockdown, with 52% noting that prices for the items they usually buy were higher than normal.

Participants (51%) said that goods were out of stock, with 32% stating that they had to purchase brands they would not usually buy. These experiences, at a time when consumers are seeking comfort and support, could mar their perceptions of some brands beyond the pandemic, says the study.

Around 80% said they had noticed examples of companies trying to take advantage during the coronavirus crisis, and most (67%) felt it was not right for companies to impose reasonable price rises on the products and services that are most in demand.

Eighty-seven percent said that how companies conduct themselves during this crisis would impact whether they do business with them in the future.

"This landscape is rife with danger for brands, along with some opportunity," says Thompson. "Since 44% of consumers said they would definitely reduce purchases to save money, competition for the consumer's shrinking rand will be fiercer than ever."

"Brands that abuse their market power at this time may struggle to regain consumers' trust as we settle into the next normal. They will also need to engage with consumers with great sensitivity as they begin to reactivate marketing and advertising strategies that were paused during the higher levels of lockdown," Thompson adds. 

"GfK Brand studies have shown that proactive challenger brands can turn the fact that consumers are looking to companies to show empathy and leadership to their advantage," says Thompson."

"Others could build long-term relationships with consumers who are usually loyal to another brand in a time when consumers are being forced to try alternatives to their preferred products," concludes Thompson.

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