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Mary Duenwald

Why Shoppers Are Swerving Between Saving and Splurging

Thoughts of death have strange effects on consumer behavior.

What drives our buying behavior?

What drives our buying behavior?

Photographer: Kathrin Ziegler/Digital Vision

As the coronavirus pandemic continues, Bloomberg Opinion will be running a series of features by our columnists that consider the long-term consequences of the crisis. This column is part of a package envisioning a new consumer economy. For more, see Andrea Felsted on the future landscape of retail, a look at technology changing how we shop and Tara Lachapelle on fixing the broken business model of streaming.

Consumers tend to respond to mass crises in two contradictory ways, research has shown: We retract into our shells and hold onto our money, then we spend as if there’s no tomorrow. One reaction naturally follows the other: First comes penny-pinching to help us regain a lost sense of control, then an exuberant play to live this brief and fragile life to the fullest while we still can.

Buying behavior, in other words, is tied to how people are feeling about their own mortality — subconsciously or not — especially in times of great social trauma.

Are these the reactions we should expect in the wake of Covid-19? If so, how will they play out? Doug Stephens, the founder and president of Retail Prophet and the author of two books on retail consumer behavior, has been looking at past widespread traumatic events for the answers. I asked him some questions about what the future might hold. Here is a lightly edited transcript of our exchange.