The COVID-19 pandemic has knocked consumer confidence hard, with profound and far-reaching implications. It has disrupted every aspect of daily life, including employment, consumption, and freedom of movement, creating uncertainty about what is safe and what lies ahead. Standard business has been upended, vaporizing certain norms consumers have always expected and assumed. This has created challenges and opportunities to which every organization — brand owners, especially — must now respond.

What’s Happened

By early May of 2020, confidence levels had fallen to below 100 on the Organization for Economic Cooperation and Development’s consumer confidence index, plummeting sharply to the lowest level since 2015. This indicated a stark reversal from confidence in the general economic situation and a willingness to spend to an attitude of pessimism and cost consciousness — a significant shift that occurred in a matter of weeks.

Established brand loyalties and purchasing behaviors shifted too, as spending fell across all industries, with larger purchases hit especially hard. Our own research shows that this is the result of lockdown measures restricting both people’s ability to earn and spend money, and expectations that household income will continue to fall in coming months.

Now, as companies work to prepare for what happens after the pandemic crisis eases, rebuilding confidence has become a business imperative, paving the way for a confidence economy.

You can read the rest of this article in the below link:

https://sloanreview.mit.edu/article/the-cost-of-confidence/?utm_source=newsletter&utm_medium=email&utm_content=understand%20people%20more%20deeply%20than%20ever&utm_campaign=Enews%20BOTW%207/10/2020