Earlier this year, we saw the predictable ‘panic shopping’ in response to the pandemic, but how has COVID-19 affected consumer behaviour more specifically?
The COVID-19 pandemic is extremely complex and multifaceted. I will focus on one of its many consequences on consumer behaviour – the heightened experience of resource scarcity. The pandemic has been the source of many forms of scarcity: product stock shortages, financial constraints, time pressures, lack of protective gear for front-line workers, sky-rocketing unemployment rate, economic recession, and so on. People from all walks of life have been increasingly experiencing resource scarcity in their daily lives, while also being regularly exposed to scarcity-related news and information.
My co-authors and I have identified two main routes through which consumers attempt to cope with feeling that they “do not have enough.” One route is a more direct route to reducing the feeling of scarcity, while the other is more indirect.
Some of the panic shopping that we observed during the pandemic is an example of what we call the scarcity-reduction route. This is the most direct way for consumers to reduce their feelings of scarcity by investing money, time, and/or efforts into acquiring the scarce resource.
As an example of the scarcity-reduction route, many people may not have had (enough) hand sanitizer when the pandemic hit, which greatly increased their desire to acquire the product. Seeing the news and social media flooded with images of empty store shelves and of consumer stockpiling may have prompted more people to follow suit due to a fear of product shortages. This, ironically, exacerbated the shortages.
Another type of panic shopping that we observed during the pandemic provides examples of what we call the control-restoration route. This occurs when the experienced resource scarcity cannot be alleviated by investing money, time, and/or effort, such that people instead seek an indirect way of dealing with the unpleasant feelings resulting from actual or perceived resource scarcity.
For instance, people have been engaging in considerably more activities to help restore their sense of control and feelings of security since the pandemic hit, such as baking, sewing, or playing video games.
Are there other ways in which experiencing resource scarcity affects our behaviours?
In another research article, my co-authors and I found that experiencing resource scarcity (e.g., financial constraints, time pressures, etc.) or being exposed to scarcity-related cues (e.g. seeing empty store shelves) prompts consumers to become more competitive and focused on their own welfare. They become more focused on protecting their own resources and on acquiring more for themselves and their loved ones, while being less focused on the needs of others.
Seeing empty shelves in stores, on social media, and in the news may have triggered this competitive response, even if many of the stock shortages were due to supply chain issues and increased in-home consumption (due to stay at home orders), rather than consumer hoarding. Interestingly, accidental stockpiling, where most consumers added just a few more items to their shopping cart and/or shopped more often, seems to have put the most strain on retailers when compared to the rarer cases of hoarding.
Experiencing resource scarcity can also increase dishonest behaviour, such as fraud, cheating, hoarding, or price gouging, especially if it provides a mean to acquire resources. For instance, in a study where participants were rewarded money based on their performance, those exposed to scarcity-related cues (vs. neutral cues) claimed having correctly solved more anagrams, as compared to their actual performance (which was also recorded), and, thus, obtained more money than they should have. Similarly, as products such as hand sanitizer, disinfecting wipes, and N-95 masks were rapidly getting increasingly scarce when the pandemic hit, some people engaged in price gouging by stockpiling and reselling these products at a high premium.
However, while experiencing resource scarcity can make people more selfish and increase dishonest behaviour, it can also have positive impacts on consumer behaviour, such as an increased desire for self-improvement. Since the beginning of the pandemic, many self-improvement products and services for both physical and mental health, such as virtual fitness programs, mindful mediation apps, online certifications and training have had soaring subscriptions or sales. This phenomenon could be partly due to a heightened sense of resource scarcity.
My co-authors and I have found that experiencing resource scarcity can negatively impact peoples’ self-esteem and, especially, their concerns about how they are perceived by others. Products and services offering self-improvement benefits can help address both the competitive response and the decreased self-esteem triggered by experiencing resource scarcity. Such products and services allow consumers to gain a competitive edge over other consumers who may also be trying to acquire the same scarce resources. For instance, obtaining online certifications during the pandemic can help people retain their precarious job or be more competitive in a scarce job market.
Conversely, such products and services also allow consumers to self-improve by “competing” with their past selves. Fitness apps often encourage people to beat their previous time, number of repetitions, and other workout statistics. Interestingly, this “self-competition” can foster a sense of community by encouraging consumers to share their best results with others to also help them self-improve.