Bank of New Zealand (BNZ) card spending data released today shows that the downturn in spending during the Delta lockdown was less extreme than during the nationwide lockdown in 2020, although the recovery is more drawn out.
BNZ Chief Economist, Paul Conway, says, “It’s clear that the greater use of e-commerce has softened the economic impact of the pandemic during the Delta lockdown.
“Stronger online spending is a significant part of why overall spending didn’t fall by as much as in the 2020 lockdown. Also, the fact our economy roared out of the nationwide 2020 lockdown gave New Zealanders more confidence to spend during the Delta lockdown.
“It’s clear from our data that merchants with a higher proportion of online sales experienced much less extreme cuts in consumer spending going into the Delta lockdown,” says Conway.
Online vs in-person BNZ card spend (indexed)
With Christmas around the corner and more certainty around the COVID-19 Protection Framework, the importance of being digitally enabled is clear:
“Selling online allows merchants to not only reduce transaction costs and to expand their markets, but also to hedge against disruptions in face-to-face retail.
“Although New Zealand is moving away from using lockdowns in the fight against COVID-19, some settings within the traffic light system will also constrain foot traffic for many businesses. As COVID-19 goes endemic in the community, Kiwis may also feel less inclined to get out to the shops.
“By increasing their presence online, retailers can build in greater resilience in a COVID-19 world,” says Conway.
Full report can be found here: Delta Consumer Spending – digital shopping a vaccine for the economy.