What Will the ‘COVID-Era Consumer’ Do in 2022

What Will the ‘COVID-Era Consumer’ Do in 2022?

It's funny how narratives and news cycles can shift on a dime.

Remember the tariffs? Nathan Shipley does. Back in 2019, “that’s all we were talking about as an industry,” Shipley recalled, during his “Aftermarket Outlook 2022” presentation this past November at AAPEX.

Looking back at the “Distribution Preview” in the January 2020 issue of AMN/Counterman, aftermarket leaders consistently expressed concerns that former President Trump’s tariffs – and China’s retaliatory tariffs – could disrupt aftermarket supply chains, leading to higher prices and even production interruptions. Tariffs remained on their radar in January 2020, although it looked like the aftermarket was weathering the storm. 

It’s funny how narratives and news cycles can shift on a dime. Beginning in February 2020, the tariff conversation came to an abrupt halt, as a highly infectious virus emerged on our shores and threatened to upend our industry and our way of life. 

Shipley, who is executive director, industry analyst, for The NPD Group’s Automotive Aftermarket division, is in a unique position to assess the pandemic’s impact on consumer behavior. The NPD Group has access to point-of-sale data from more than 600,000 retail locations, plus e-commerce and mobile platforms. In the automotive aftermarket, the firm tracks data from more than 26,000 retail outlets.

The pandemic’s impact has been so profound that Shipley used the phrase “COVID-era consumer” at AAPEX. 

“Our behavior as consumers has fundamentally changed, and what we’re doing now compared to what we did 20 months ago is different,” Shipley asserted in November. “If you really stop to think about all the things that we’ve been doing as individuals over the last 20 months relative to what it looked like pre-COVID, we’re different people.”

Yet, despite all of the challenges (as it turns out, the pandemic has caused far greater turmoil in our supply chains than the tariffs ever did), business in the automotive aftermarket has been booming – especially on the DIY side. As I mention on page 56 in my recap of Shipley’s AAPEX presentation, The NPD Group estimates that the aftermarket gained nearly 4 million new DIY customers in 2020. 

When the dust settled on the roller-coaster ride of 2020, aftermarket retail sales were up by 6.7% over 2019. The momentum extended into 2021, with aftermarket retail sales increasing by 7.9% over 2020, according to Shipley and The NPD Group.

In a September 2021 blog post, Shipley offers some great insight into where the growth occurred.

“Generally, 2020 showed us that front-room-category retail sales growth came primarily from  discretionary and recreational categories – nice-to-haves, not must-haves, to make a vehicle run properly,” Shipley wrote. “Accessories, appearance-related items and products for towing and hauling trailers and cargo led the way. Other categories, like marine batteries and small-engine spark plugs, also grew by double-digits.  

“The picture painted by the top growth categories showed a clear change in consumer behavior – accessorizing and detailing daily drivers; people working on project cars, boats and RVs; and those prepping family vehicles for road trips to ‘anywhere but here.’ While all of this growth was happening, the light-maintenance product categories that typically are the bread and butter of the store, like motor oil and wiper blades, did not grow at all in 2020.”

At AAPEX, Shipley asserted that the big question for parts retailers is which pandemic-induced behavior changes will stick, and which ones will revert back to pre-pandemic times. My guess is a number of them will stick. 

While post-lockdown consumers might not have as much time (or cash) to work on their project vehicles as they did in 2020 and 2021, I’m convinced that our rekindled love affair with road trips isn’t a passing fad. Likewise, I believe Americans will keep boating and camping in record numbers, as they try to feed that nagging itch to get out of the house after two years of remote work and quarantining. And, regardless of whether or not COVID-19 remains an ongoing threat to public health in the coming years, I think the notion of the personal vehicle as a safe haven has plenty of staying power.

The beauty of the automotive aftermarket is that the economic conditions always seem to work in the industry’s favor – whether the economy is booming or mired in a recession. That’s one of the reasons I’m optimistic about 2022. The biggest reason, though, is all of the great people working behind the counter at parts stores throughout the nation. Here’s to a fantastic 2022 for you, your co-workers and your loved ones. 

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