While over 30 million Americans have lost their jobs due to the pandemic, a modest subset of the population has circumvented any negative financial consequences. Besides avoiding layoffs and pay cuts, some have even grown their wealth by spending less, taking advantage of the bear market, and saving or investing their stimulus checks.
In our proprietary survey of personal finances in America during COVID-19, 27 percent of respondents said they have steered clear of financial strain. We call this segment the Optimists: a prosperous group of consumers who are gearing up to flood the market once the global health crisis subsides. (To learn about their less-fortunate counterparts, see our deep-dives on the other two segments: the Modifiers and the Recoverers.)
Who are the Optimists? According to our survey, they are most likely to:
Work in white-collar professions
Pay for premium digital subscriptions
Live in metropolitan areas
Be part of the Boomer or Gen X generations
Travel often for work and/or pleasure
Though most Americans — regardless of income fluctuation — have cut their spending on discretionary items, there are behavioral nuances between the three consumer segments we’ve identified. Most likely to be working from home, the Optimists are investing in home office equipment, virtual fitness offerings, digital cooking guides, and related goods and services to support their productivity and wellness amid lockdown. Cognizant of the profound hit that many local restaurants have taken, this group is also spending more on restaurant delivery and takeout in attempts to bolster struggling businesses in their communities. Even once offices, gyms, and restaurants reopen, 75 percent of the Optimists in our survey said they plan to keep their premium digital subscriptions. Now acclimated to the ease and flexibility of online services, the Optimists may start experimenting with live-streamed experiences beyond the realm of health and wellness, like virtual travel and educational opportunities.
FIG COVID Segmentation Study. May 2020.
As stay-at-home orders gradually lift, the Optimists will make up the vanguard of consumers who revivify dormant markets. Chief among those markets will be the travel sector, which relied heavily on affluent clientele before the pandemic. Vestigial fear of COVID-19 infection will influence how the Optimists choose to travel, but it will not stymie their eagerness to make up for vacations they had to cancel. In the near future, road trips and vacations close to home will be preferred, as travelers will be wary of taking any undue health and safety risks. As travel becomes more normalized, those planning bigger trips will require a new level of privacy, translating to increased demand for villas, remote destinations, and stand-alone accommodations offered by luxury hotel brands like Aman and Rosewood. To safely reach off-the-beaten-path locations, they will turn to hop-on jet travel brands like JSX that offer contactless check-in and 20-person passenger limits.
After weeks cooped up at home and barred from their familiar spending habits, the Optimists are newly receptive to high-ticket investment items like cars, real estate, and ultra-luxury goods. E-commerce will continue to be the favored shopping platform, as Optimists will likely work from home long after most businesses reopen. The early days of COVID-19 recovery will be an opportune moment for brands to inspire affluent individuals who are yearning to make use of their savings. Brands are already targeting consumers with special deals to spur future spending: the three major U.S. airlines have extended their elite offerings, while in the luxury fashion sector, Cult Gaia has created a charitable Instagram campaign for No Kid Hungry that enters participants in a sweepstake to win site credit. Such high-profile initiatives work twofold, keeping core demographics engaged, while garnering widespread respect from consumers across the board.
FIG COVID Segmentation Study. May 2020.
While they are by no means the majority of Americans, the Optimists will have considerable economic sway as the nation attempts to recover from weeks of shutdown. Keen to leverage the income and savings accrued during quarantine, this influential segment is both ready to spend and newly conscious of the impact of its dollars. Brands can garner attention and goodwill from Optimists by sending messages of inspiration, optimism, and wherever possible, charitable impact.
For a more detailed breakdown on the Optimists as well as the two other consumer segments we’ve identified — and ideas on how to reach them, see here.