Economy July 19, 2020 - 10:06 am

COVID-19: What are the consumption prospects of the Dominican?

• 86% of consumers in the Dominican Republic will continue to change the priority of non-essential products

The study carried out by the EY firm, through the EY Parthenon tool, with a sample of more than 7,600 consumer responses in Costa Rica, Panama, and the Dominican Republic, reveals that consumers have significantly changed their consumption preferences towards reduction, the purchase of low-priced products and the focus on essential products.

In the short and medium-term, as consumers continue to face headwinds, they will continue to maintain cautious consumer behaviors, including downsizing, purchasing low-priced products, and changing the priority of nonessential products.

• The reduction is likely to continue as the majority of consumers will continue in “savings mode” and reduce the costs of non-essential products.
• The purchase of low-priced products will continue as most of the people whose income has been affected will continue to buy more accessible brands (or substitutes).
• Consumers will continue to prioritize essential products in their spending, and retailers will follow consumers as they have up to now.
• Online delivery platforms are likely to remain as consumers have tried them and enjoyed their convenience.

In the medium term:

• Switching to higher-priced products will require a “persuasive” effort since the longer the pandemic lasts, the more satisfied consumers will be with their new (cheaper) brands; Even if their wages return to their normal amount, they will continue to buy cheaper brands.
• Non-essential product categories will require strong incentives and campaigns to resume purchases on everything from electronics to cosmetics.
• As consumers continue to enjoy the “new” digital channels, they will continue to purchase most of their products online.

DATA

• 36% of consumers in the Dominican Republic will continue in savings mode for the next 6 months.
• 86% of consumers in the Dominican Republic will continue to change the priority of non-essential products.
• 87% of consumers in the Dominican Republic are satisfied with their online shopping experience and will continue to use this mode of purchase.
• 63% of consumers in the Dominican Republic have said that they will continue to buy products online in the short and medium-term.

Beyond the Covid-19

• Trading will require a persuasive effort.
• Non-essential categories will require strong initiatives.
• The digital trend is here to stay