Over half of households 'optimistic' about financial future post-pandemic

 

EVEN with record numbers of temporary unemployment and forecasts of economies shrinking in practically every country in the world, the majority of Spanish households are fairly unworried about the financial future – they believe that as long as funding is there to help those affected survive until they can get back to work, customers and businesses will make up for lost time with relatively little harm done.

Marketing consultant firm Kantar carried out surveys and interviews, and its manager for consumer affairs, Edurne Uranga, says 54.7% of households in Spain believe the economy will 'go well' over the next 12 months, despite the pandemic.

This, says Sra Uranga, is 'good news' for the high street, since this level of optimism will translate to people having the confidence to spend on non-essentials without the constant fear of what may be around the corner.

Of course, this leaves 45.3% who are pessimistic – but of the total interviewed, 17% said that although they were currently in a bad place financially and struggling to cope, they expected their circumstances to improve over the next year.

Another 10.3% were in the opposite situation: They do not have any real money worries at the moment, but believe their finances will get worse over the next year.

The gloomiest of all were the 18.1% of households who were barely making ends meet and did not believe things would get any better for them within a year – although it is not clear how many were already in this situation, short-term or long-term, before the Covid-19 crisis.

Customer services office manager Joan Riera said optimism or pessimism about the national economy and their personal finances was not the end of the story: The health situation would also guide consumers in their spending decisions.

In this case, though, pessimism translated to high consumer spending – those who were most concerned about their health seemed to indulge more on products that gave pleasure rather than mere staples, and were also more likely to buy organic produce and healthy foodstuffs in a bid to protect themselves more.

Life post-Coronavirus could change the way supermarkets and hypermarkets work in future, says head of Iberia Retail at Kantar, Florencio García.

“Rather than being a coup de grace, it could end up being more of a bombshell effect – for example, creating large physical spaces to ensure social distancing,” he says.

“For this reason, small, local shops could find themselves at a disadvantage in the future, although internet shopping has been given a great opportunity through the pandemic and is likely to double its sales in 2020.”

Local shops may not face quite the drawbacks García believes, though: During lockdown and now in the 'scaling down' process in which 70% of Spain is set to be on 'Phase 2', the penultimate stage, by Monday, independent boutiques, family-run retail establishments and the high street in general has shown itself to be resilient and adaptable.

Card payments for even the smallest amount are now more the norm, and town-wide campaigns are gradually being launched to attract customers again.

One example is in the village of Pego (northern Alicante province) – retailers have been inviting customers to complete a questionnaire, to find out what they want and need, and everyone who does so gets a free 'Covid-19 kit' worth €25 containing masks, gloves, hand-sanitiser and a cotton reusable shopping bag.

Response has been so overwhelming that within two days, all 500 free 'Covid-19 packs' were snapped up, forcing shopkeepers to order in another batch.

Another example is in Xàtiva (central Valencia province) – customers can now buy €40 vouchers to spend with local retailers, purchasing these online via the bank Caixa Ontinyent, and costing €20, meaning they effectively get to buy anything they want from €20 upwards at half price.