There’s no denying that the COVID-19 pandemic was the catalyst for many changes that lead to a shift in consumers’ lifestyle trends and retail situation. With the New Normal, things that were once popular are inevitably replaced with New Essentials. Here are four key items to keep an eye out for, as indicated by SCB Julius Baer’s Global Wealth and Lifestyle Report 2021 (GWLR2021).
In a research conducted by Julius Baer, a Swiss global wealth management group, the study revealed that people are becoming more health-conscious and environmentally concerned than ever. Julius Baer’s report demonstrates New Normal has indeed marked an immensely significant shift in goods to be considered. Former items such as grand pianos, wedding banquets, beauty services and personal trainers are no longer the priorities for consumers and instead replaced with four entirely new items: bicycle, treadmill, health insurance and technology.
While this might not come as news, the emerging trends are giving us hints on how the world is changing and an indication of new investment trends that might be here to stay. In short, if you are looking for a sustainable investment to secure long-term wealth, this might be the way to go. So why have these four items made it into Julius Baer’s list? We break down the reasonings of each item.
Even pre-pandemic, the sales of bicycles has been rising consistently before surging during 2020. For busy office workers and city dwellers, they are a functional mode of transport thanks to their dual benefit of exercising, avoiding traffic and most importantly, staying safe from public transportation. Plus, bikes are also a more climate-conscious choice—a subject that has gained attention amongst many individuals and governments across the globe.
One of the most unmistakable trends that emerged from the pandemic is digital disruption and how offices operate. In the words of Julius Baer themselves, “the ability to stay connected remotely has become increasingly important over the past year as people have found themselves separated by the pandemic”.
Within just a few months, life as we knew it shifted onto the online network. The report from the Julius Baer Index indicated that in 2020, an estimated 4.5 billion internet users worldwide were spending a third of each day online, with over 80 per cent of the users active on social media. This lifestyle change and demand for constant connectivity will continue to rise, making technology products such as smartphones, tablets and personal computers one of the key consumer items on the Index this year.
People want to stay fit during the pandemic, but with gyms and personal trainers out of the equation, they are replaced with the treadmill. The increased demand for at-home fitness regimes means that sales of treadmills dramatically soared 135 per cent between March and October in the US alone. Since the New Normal, there has been an increase in on-demand services from fitness centres. Combined with flexible schedules and the WFH office routine, one can be confident that the trend for home exercises will be here to stay.
After the global healthcare infrastructure was stretched to its limits, healthcare has become a priority, with many individuals and families seek to secure health insurance should a medical emergency occur. It is predicted that the health insurance industry will continue to expand with a compound annual growth rate of 4.7 per cent between 2021 and 2017. (GWLR, 2021)
The price of each region would vary depending on each country’s medical infrastructure and the accessibility to state-provided healthcare. Interestingly, the most and least expensive locations happen to be in the Asia Pacific region, with Bangkok cited as the most costly and Shanghai as the least. While the most expensive region may be the Americas, individually, Bangkok remains one of the most expensive cities for health insurance.
Emerging trends and making a sustainable investment
Joseph Caceres, Managing Director and Head of Investment Advisory & Solutions at SCB-Julius Baer Securities, shares his perspective for those looking to make sustainable, long-term investments. “We believe that sustainable investment is the key to securing long-term returns for our customers. The trend of investing in environmental protection is likely to grow, which is evident from the increasing use of bicycles or the shift to zero-emission electric vehicles. Therefore, investors should consider investing with companies that are reliable, stable and possess a good balance sheet.”
Continuing, he explains that investors “should also consider a company that takes responsibilities in three main areas: Environment, Society, and Governance, known among investors as ESG. Consumers today are more cautious in their spending; as a result, investors should look for a more flexible way of investment (Core Satellite Approach) and distribute their risks in different types of investment rather than investing in just one product. SCB Julius Baer brings forth our expertise with a team of knowledgeable investment advisory experts who are experienced and certified by Julius Baer’s wealth management standards. We are ready to provide advisory services to our esteemed customers and equip them with knowledge to assess the returns on their investment portfolios, in order to pass on wealth to the next generation in a sustainable way.”
SCB Julius Baer’s Global Wealth and Lifestyle Report 2021 (GWLR2021)
(Images: SCB Julius Baer)