SOUTHERN PINES, N.C.--(BUSINESS WIRE)--A new report from Vector Analytics quantifies the impact made on retail sales by the 911 attacks and the 2003 SARS outbreak, and uses that information and consumer sentiment measures to predict how consumer fear associated with the current Ebola crisis may affect consumer retail sales in the US this holiday season.
According to Marcia Price, president of Vector Analytics, “People are worried that the headline risk of Ebola could cause a negative change in consumer purchasing behavior. To answer this question, we conducted an analysis of retail sales and consumer sentiment during the US 911 attacks, the US SARS scare, and the Hong Kong SARS outbreak. We quantified the negative impact of each crisis on retail sales and also identified the decline in consumer sentiment that was associated with each crisis. This data can be used to model retail exposure associated with the Ebola situation now and in the future.”
Vector Analytics found that consumer fear during the 2003 US SARS outbreak created a negative impact on retail sales that was approximately half the size of the negative impact on retail sales associated with the 911 attacks.
Ms. Price continues, “We have yet to see evidence that consumer sentiment indexes are being negatively affected by the Ebola situation in the US. Although the headline risk of Ebola may have caused some limited regional retail reactions and some financial market volatility, we do not believe that Ebola has affected overall retail sales in the US yet. However, we speculate that if consumer fear associated with Ebola were to increase and cause declines in consumer sentiment that were similar to those experienced during the US SARS scare, or worse yet the 911 attacks, there would be a measurable and predictable decline in retail activity.”
Vector Analytics looked at thirteen different retail sectors in the US and eight different sectors in Hong Kong. A general trend found across all three crises was that purchases of less essential consumer goods, such as clothing, jewelry, and sporting goods, suffered the largest declines during a crisis; while consumer purchasing behavior associated with grocery store and pharmacy purchases, although still affected, posted less severe declines.
Vector Analytics believes that the impact of Ebola on US retail sales is linked to the ability of US authorities to control headline and sentiment risk by preventing unidentified importation of additional Ebola cases into the US and by successfully preventing additional contraction or spread of the disease on US soil. If consumer sentiment were to decline significantly due to a worsening Ebola situation in the US, consumer purchasing behavior would change. Potential changes could include less shopping in brick-and-mortar stores this holiday season and higher than anticipated online purchases and associated parcel delivery volume. It is crucial for retail executives to understand the potential risk the Ebola situation could have on US retail sales; Vector Analytics’ report provides a methodology for predicting that risk. Visit www.vector-analytics.com or contact Marcia Price at 910-585-6228 for more information on this report.
About Vector Analytics. Vector Analytics provides analysis of retail and technology trends. As quantitative futurists, they are experts at backcasting, forecasting, and synthesizing data from multiple sources to provide synergistic and insightful market intelligence.