At the risk of being alarmist, we are pointing out the following graphics on (Swine) Flu with caution. In no way is the Research Edge Retail team pretending to be CDC workers or doctors, but we would be foolish to ignore such eye opening trends. The charts below tell the story, although we can say with certainty the media isn’t shying away from what may become the most talked about national topic in the coming weeks and months. As evidence as to how consensus the concerns are, do a quick Google News search for “Flu” and you’ll find around 75mm hits, with about 39mm of them related to H1N1 specifically, and about symptoms, prevention, and the effectiveness of wearing surgical masks.
We’ll leave it to you to decide if you want to stay home, avoid public places, and use Purell every five minutes. However, we’re fairly sure if the Flu virus continues to permeate the rest of the U.S with the speed and breadth as we have observed in recent weeks in the South, then there will be implications for consumer spending in both quantity, category and channel.
So, how should we think about the potential impact of Swine Flu fear and/or actual symptoms impacting a large portion of the U.S population? The obvious answer is to think about which retailers may benefit from this pandemic, which include CVS, WAG, and RAD. For those thinking about which companies may suffer most, mall-based retailing could take the biggest hit as consumers look to avoid highly populated public areas. For the extremists, Amazon.com, Drugstore.com, FedEx, and UPS all could benefit from cocooning.
We don’t have all the answers and we’re not into “playing” names at the expense of human suffering, but this is a trend worth watching. For now we’re digging to see if any impact is materializing in the South as the brown states have reached “widespread” levels of Flu activity. And for those who haven’t bookmarked http://www.cdc.gov/flu/ now is a good time.
Eric Levine
Director
