As the nation reopens, individuals and organizations are assessing the impacts of COVID-19 on local businesses and finding that the business landscape has changed dramatically. Businesses must find creative ways to provide goods and services to their customers if they want to survive.
Birdeye helps businesses across every industry to be found, chosen, and the best. This gives us unique visibility into which industries are recovering fastest and which ones are struggling to adapt to the new normal. In our exclusive study, we’ll look at trends in search volume – an indicator of consumer demand – before the shutdown into today that can be used to:
- Identify growing industries – as well as those that are struggling.
- Inform critical business decisions based on changing consumer preferences.
- Develop a winning strategy for the rest of the year and into 2021.
Let’s dig in!
Consumers’ online search patterns are a direct reflection of their intention to buy. Google calls this the Zero Moment Of Truth – the point in the buying cycle when the user is researching a product. For example, if a consumer is searching online for an e-bike, she intends to buy an e-bike.
Prior research indicates that the “peak of search traffic often precedes the sales peak.” Therefore, changes in search volume can be considered a reliable indicator of changing consumer preferences – and thus, sales.
For this study, we used Birdeye’s robust directory listing platform to assess how consumers’ online search patterns have shifted due to COVID-19. The directory listing platform hosts the profiles of millions of businesses across several industries and compiles relevant business information (e.g., operating hours, customer reviews, etc.) onto one page. Which are, in turn, optimized for search engines like Google.
We conducted a pilot study in May 2020 to determine if there were any shifts in consumers’ search behavior due to COVID-19.
Here is a summary of our findings:
- Consumers’ behavior online changed and evolved with the times. For example, when shelter-in-place orders started being issued state after state, the search behavior shifted to life essentials.
- Online search volumes for key industries declined and into the end of April. This occurred almost immediately after the world went into lock-down
- Search volume declined based on whether or not businesses and industries were deemed essential.
- Essential businesses like Grocery, Auto Repair and Gas Stations saw a lower decline.
- Non-essential businesses in the Dental, Beauty, Business Services, Wellness, and Hospitality sectors saw the steepest decline in search volume.
- Certain industries were more likely to recover as the country reopened. The sectors that showed the fastest turnaround were in the Beauty, Construction, Home Services, Education, Wellness, and Real Estate sectors.
- Holistically, online search volume was impacted by what:
- Governments declared essential (e.g., Healthcare, Automotive, Retail, Grocery).
- Consumers thought was essential (e.g., Beauty, Wellness, Real Estate).
- Consumers deemed important as they adjusted to the work from home lifestyle (e.g., Home Services and Education).
These findings show that online search trends can be used as an indicator to determine how the industries would continue to recover from the pandemic. In this updated study, we examine how these trends have panned out over the past few months – especially as businesses begin to reopen.
Read on to learn about our findings.
August 2020 report
We observed a lot of movement in search volume across most industries as we looked at data from March-July 2020. The graph below shows how the search volumes declined across industries between March 15th and April 31st (Orange) and May 1st and July 31st (Green).
The fluctuations observed in online search volume began in the middle of March when shelter-in-place initiatives started across the country. We saw a steep decline in the volume of online searches between March 15th and April 30th. In May, as some of the restrictions started to ease, search volumes also started going up. As expected, some industries fared better than others. Below is a summary of our findings from the online search volume study.
How does this data compare with what’s going on in the world?
Market dynamics and consumer behaviors are changing fast, and businesses are rapidly adjusting to keep up. While it will take some time for certain industries to fully recover, others showing early signs of rebounding. Our online search traffic data mirrors this trend. Let’s look at a few examples:
- Initially, dental practices were only allowed to see patients with emergencies.
- Nine out of ten dental practices had less than a quarter of their average patient volume.
- Following CDC’s Interim Reopening Guidance for Dental Settings dentists have restarted elective procedures.
- People are back to searching online for dentists; however, they are still cautious and are avoiding a visit to the dentist unless necessary.
Takeaway: The uptick in search volume for dental practices indicates that the industry is experiencing a healthy recovery.
- The automotive sector was deemed ‘essential’ throughout the lock-down, and auto-repair shops and auto-body shops stayed open.
- Though new car sales did see a decline, used car sales have rebounded faster. Perhaps explained by a survey that found almost half of the respondents would prefer to use personal cars rather than public transport for safety reasons.
Take away: We predict that due to the rapid rebound in search volume, an increase in car sales is imminent.
- US housing prices continued to grow through the pandemic: house prices in May were 4.3% higher than the prior year.
- Home prices rose during the lockdown due to heavy buyer competition and a significant shortage of supply.
- Existing home sales grew in June after three months of sales decline.
Take away: The slight dip (5%) in online search volumes in the category followed by a significant recovery is consistent with this trend.
- The Home Services category has seen consistent growth over the last two years. However, most of the businesses in this industry felt the initial impact of the pandemic.
- Contracting saw a decline in search volume when the stay-at-home orders came into effect. In May and June, however, the new-orders returned to pre-COVID levels.
- Green Services (Lawn care, landscaping, etc.) fared significantly better thanks to the outdoor nature of work where social distancing rules are easier to follow.
- Consumer spending in the category recovered nicely in May and is back towards positive year-over-year growth.
Take away: Due to the inherent seasonality of the Home Services industry, the market typically starts heating up in Spring – which coincided with the beginning of the pandemic. While search volumes did not go down, they did spike as they typically would. As the industry rebounded, online search volumes and new work increased with it.
- Retail spending increased by 1.2% in July, marking its third consecutive monthly increase and bringing the total value of U.S. retail sales above pre-pandemic levels.
- Though the jump is weaker than expected, nine of the 13 major spending categories reported higher sales in July.
Take away: Search volumes in the Retail sector stayed within the same range from January to April, but increased between May and July (8.4% in June alone), confirming the market trends.
- At the onset of the pandemic, restaurants were asked to close all in-restaurant dining to curb the spread of the virus.
- Towards the end of May, some US states allowed the reopening of restaurants with varied restrictions. Some allowed only out-door dining, while some allowed indoor dining with a restriction to open at 25% capacity.
- Consumers have also been dining out less and less due to general caution in public places.
- At the time of this study, the year-over-year decline of seated diners in restaurants in the U.S. was a staggering 47.94%.
Take away: The recovery in search traffic seems to be coming primarily due to the shift restaurants are making towards take-out and curbside pickup. It is important to note, however, that the restaurant industry is still struggling overall.
Conclusion: The impact of COVID-19 on your business
As consumer behavior continues to change, businesses need to change their marketing strategy, adopt new tools, and keep their customers in the front and center to survive. First movers may gain an early advantage that their competitors will find difficult to match.
Want to know more about adapting to changing customer expectations? Check out our on-demand webinar on digital transformation.