The coronavirus-disease 2019 continues to unfold worldwide. Now, for the first time, the World Health Organization has called the disease a pandemic. Its official declaration of a pandemic means that it has now reached a point where the pathogen spreads on a wider geographic scale even though the certain threshold for meeting such criteria remains fuzzy. This led to one curious side effect: shoppers have started stocking up on items, such as masks and hand sanitizers.
Psychologists' view on panic buying
Singapore-based INSEAD Business School’s assistant professor of organizational behavior Andy Yap explained that the disease is something that people cannot see. When that happens, they lose their sense of control. But the sense of control is important for one’s well-being and is likely a biological and psychological necessity. This is why people do and try things to achieve and compensate for that control again. Buying things is one way to achieve that.
Yap and the team conducted a study and they found out that when people lose their sense of perceived control, they will try to solve the issues that caused them to lose that sense of control in the first place. In short, if people are anxious because of the virus, they purchase things that could prevent them from getting infected and they go to cleaner places. As it ends up, more people would buy hand sanitizers, masks, and other cleaning detergents to clean their offices, houses, and so on. Most of the time, it doesn’t matter whether the safety measures are effective. Most people just do it to feel safer and better.
The assistant professor went on to state that they started their study in 2017 to focus on what people do when they experience anxiety and stress. So, they run a series of experiences in a lab and supermarket. Their study titled “Control Deprivation Motivates Acquisition of Utilitarian Products” was published in the research platform ResearchGate. They wrote, “the fundamental desire for control affects product acquisition.”
Social media as an echo chamber of panic
Yap also recently recommended that people not spend a lot of their time on social media because it is an “echo chamber” of panic. Once a person sees on social media that all sorts of things are running out, it would lead to more panic worldwide. He observed that the same behavior was not observed when there was a similar infection called SARS. Back then, there was less panic buying because we didn't yet have an echo chamber in our hands.
The real damage of panic buying
In response to face mask shortages, US Surgeon General Dr. Jerome Adams has also pleaded with Americans to “stop buying masks.” He posted on Twitter that face masks are not effective in preventing the general public from catching COVID-19 but if the healthcare providers will not have enough face masks to help care for the sick patients, it not only put their lives at risk but also the community at large. Adams emphasized that the best protection for the public is to stay at home if they are sick and to wash their hands.
Japanese newspaper The Japan Times also published that their government will punish people who will resell face masks for a profit with a penalty of one-year imprisonment and ¥1 million fine or both. The daily also shared that nearly 20% of Japan’s nursing care service providers have already run out of face masks. E-commerce company eBay and Facebook have also banned medical face masks and hand sanitizer listings to stop online price gouging during the coronavirus outbreak.
University of Oxford marketing professor Andrew Stephen also said via Bloomberg that people are not equipped psychologically to process such ideas in times of uncertainty. The thought of extended home confinement has also sent people scrambling for other goods, like oat milk because of its longer shelf life.
Market research firm Nielsen noted that the sale of dairy alternative products increased to over 300% from Feb 16 to 22. There was also a boost in the purchase of pretzels, energy beverages, and dried beans. Shoppers have also stocked up on deodorant, disposable diapers, first aid kids, pet medicine, and fruit snacks. Because of the cycle of panic buying and scarcity, it will likely strain manufacturers because they will struggle to match the demand and replenish the stocks.
Health supplies sales growth
In a report published by database company Statista, the year-over-year dollar sales growth of health-related CPG items in the US in the 4 weeks that ended in February 22, 2020,are as follows: medical masks (319%), household maintenance masks (262%), hand sanitizer (73%), thermometers (47%), and aerosol disinfectants (32%).
Why toilet paper is the latest COVID-19 panic buy
Retailers in Canada and the United States have also taken drastic action to limit the number of toilet paper rolls, hand sanitizer bottles, and face masks every person can buy. Clinical psychologist Steven Taylor, who wrote The Psychology of Pandemics, said that people’s reactions are “understandable” but “excessive.” He told CNN that people would tend to resort to the extreme when they learn conflicting messages about how serious they should be prepared and the risk of the situation. For instance, they are told that the disease is dangerous but all the only actions they have to do is to wash their hands. That is a conflicting message because the action they have to do is not proportionate to the perceived threat. If it’s a special danger, then it means special precautions too.
As the Environmental Protection Agency has released the list of disinfectant products approved to use against COVID-19 no surfaces, the sales of Lysol and Clorox also rose. In 2018, the surface disinfectant market in Latin America alone was estimated at US$49.24 million but is projected to reach $68.45 million in 2023. This data is based on database company Statista.
Meanwhile, scientific online publication Our World in Data reported that the total confirmed deaths due to COVID-19 reached 4,292 as of March 11 from 2,924 on February 29 and 213 on January 31.
People are social creatures and we usually look at each other for cues. This is why panic buying also begets panic buying.