Study reveals drastic change in consumer behaviour during lockdown

Travel has practically come to a standstill due to the pandemic, but despite having being nowhere to go, Delhiites prioritised fuelling up when the lockdown was announced. Mumbai residents, on the other hand, were more pragmatic during the same period, with the city registering the highest spike in medical spends.

New research on credit card spends has revealed a drastic change in consumer behaviour during the pandemic, more so with affluent Indians and their innate penchant to spend and consume, finding a lot of their regular avenues shut.

Despite the general drop in spending, the study showed some categories registering a substantial rise, both during the first two weeks of announcement of the lockdown as well as the extension.

Digital subscription for services like OTT streaming platforms, online classes and e-newspaper subscriptions rose majestically during the lockdown, according to the study, indicating a willingness among individuals to learn and entertain themselves online. The study adds that beyond food, medicines and utilities, millennials have invested majorly on learning and entertainment during these unprecedented times.

Cred, a digital platform, conducted the study on credit card spending behaviour across cities and found some unique insights.

While Delhiites felt the need to tank up immediately as the lockdown was announced, leading to a substantial increase in fuel spends on their credit card by up to 50 per cent within the first week of the lockdown announcement, Mumbai residents’ medical spends rose by a staggering 100 per cent during the same period.

Those living in Bengaluru, on the other hand, preferred to stock up on essentials when the lockdown was announced, with residents spending the most on online grocery shopping which soared by 44 per cent.

While Mumbai residents prioritised spends on health, with spikes in both insurance (23 per cent) and medical spending, insurance spends rose across cities, with Delhi clocking 11 per cent spends and Bengaluru only 9 per cent.

Travel tripped

For the analysis, data and insights from the month of March represent the spending patterns of individuals in anticipation and immediately after the announcement of the lockdown, while April represents consumer spending behaviour during the lockdown.

Though credit card spending dropped initially by 10 per cent when the lockdown was announced in March, it slid even further by 51 per cent when the lockdown was in full swing April-onwards.

In March, cab spends decreased by 43 per cent in Delhi, 39 per cent in Mumbai and 41 per cent in Bengaluru. Travel spends also decreased by 50-55 per cent across Delhi, Mumbai and Bengaluru, the study showed.

In April, with the lockdown firmly in place, fuel spends decreased in Delhi by 53 per cent, Mumbai by 78 per cent and Bengaluru by 55 per cent. Cab spends also decreased in Delhi by 88 per cent, Mumbai by 90 per cent and Bengaluru by 89 per cent. Also on the slide were travel spends in Delhi by 87 per cent, Mumbai by 86 per cent and Bengaluru by 85 per cent.

Essentials purchase

Trying to track which city residents are the least likely to panic-buy during emergencies, the study showed Delhi stocking up the most on essentials when the lockdown was announced, with residents increasing their card spends on groceries, fuel and other utilities more than those in Mumbai or Bengaluru.

Residents in Bengaluru, however, did not rush to stock up as much, maintaining only marginal increases in most essential categories in March. This, the study states, indicates the trust in access to essentials was the highest in Bengaluru, making residents least likely to resort to panic buying and hoarding.

Some of the major spending categories that saw a drop include online food ordering and dining out, with more individuals purchasing groceries and preparing meals at home.

E-commerce spends

A noticeable decline in e-commerce and physical shopping was noticed across cities. While e-commerce spends increased marginally when the lockdown was announced, it dropped significantly during the lockdown as only essential goods were sold for a majority of the period.

In March, e-commerce spends increased marginally in Delhi by 1 per cent and Bengaluru by 2 per cent. However, spending in Mumbai decreased by 7 per cent during the month.

Physical shopping spends saw significant reductions across all cities with spending falling in Delhi by 43 per cent, Mumbai by 46 per cent and Bengaluru by 43 per cent.

April also clocked considerable drop in e-commerce spends across all cities, with spends decreasing in Delhi by 89 per cent, Mumbai by 92 per cent and Bengaluru by 87 per cent.

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