The COVID-19 crisis has definitely left its mark on our lifestyles and consumption patterns. An exceptional situation calls for exceptional reactions: today, shoppers' tendencies are largely linked to their experience of this unprecedented situation over several months. We are therefore seeing the resurgence of the phenomenon of revenge spending, caused directly by the feeling of frustration and isolation felt by shoppers. A data of choice for retailers that we handle with the utmost care.
Revenge spending, or revenge shopping, refers to the phenomenon whereby, after a period during which shopping opportunities have been restricted, shoppers decide to spend in a frenzied manner when the restrictions are lifted. Our data analysts identified this last year, when during the 2020 summer vacations, the average French budget was 5 points higher than the previous year. Shoppers, having saved during the lockdown period, suddenly increased their shopping budget. The same thing is happening now, as holiday shopping approaches.
Predicted by many analyses during the containment periods following the COVID pandemic, it was unsurprisingly in China that the trend was first confirmed. Who hasn't heard of one of those spectacular anecdotes, such as the Hermes shop that made $2.7 million in sales in one day in 2020 in Guangdong province? The phenomenon quickly spread, particularly in Europe, where long queues could be seen in front of Zara shops as soon as restrictions were lifted.
This is literally a revenge act for shoppers who have accumulated significant savings during the restrictions and are now eager to return to their former lives, to go out and treat themselves, but above all to "make up for lost time". This is good news for many retailers, who are seeing more and more shoppers returning to physical shops.
Unsurprisingly, the phenomenon has spread around the world, at different times, depending on the quarantine policies of each country.
According to an Adot study, nearly a quarter of French shoppers have indulged in revenge shopping. This demand is growing, particularly among women aged 18-34, 23% of whom said they spent more, spontaneously, in the weeks following the confinement this summer 2021. This strong demand for consumption means that their spending will be maintained or even increased in the months to come. The French also declare themselves inclined to increase their purchases from independent shops, whether physical or online.
Finally, since 2020, fractional payment (buy now pay later) has exploded worldwide, encouraging new purchasing behaviours. In France, this is now confirmed: 32% of shoppers want to pay in instalments, more often in 2020. In a health situation that is still unstable, we can consider that revenge spending has not said its last word. This is an opportunity for the retail sector to recover and for retailers to implement new strategies adapted to new purchasing behaviours, to the delight of shoppers.