Economic turmoil looms, so why are UK shoppers keeping calm and carrying on?
September 2, 2022
As UK inflation bursts above 10% for the first time since early 1982, you wouldn’t be surprised to see headlines on the cost of living crisis decimating consumer spend. Except that’s not the case…yet.
Despite retailers looking to autumn with an “air of caution”, there are some positive trends to look at regarding how consumers are acting and feeling as we wave goodbye to the summer months.
Despite prices rising more quickly than wages, the British public, so far, are keeping calm and carrying on when it comes to shopping. Retail sales unexpectedly rose in July. A 0.3% boost, driven largely by online promotions, helped to overcome a broader trend for a decline in spending.
It’s not only online that shopper’s are spreeing; brighter weather has got people out and about too, with August seeing a rise in footfall across retail destinations. According to the latest data from Springboard, footfall increased at both shopping centres and high streets.
Springboard marketing and insights director Diane Werhle said:
“Indeed, the continuous heat in August clearly encouraged people to take staycations, which fuelled activity in retail destinations. Also, many consumers took a much longed-for and deferred summer holiday during August – many of which will have been paid for last year or even the year before – driving pre-holiday spending and creating what might be seen as the ‘last hurrah’ before the rise in the energy price cap kicks in during October.”
It may have been the ‘last hurrah’ but Brits seem to be making the most of it, as the late August bank holiday saw footfall remain buoyant, not denting consumer appetites for shopping. For the long weekend, footfall was up 4.3% against the same pre-pandemic weekend and was also up week on week, with an 1.8% rise.
In terms of how consumers are acting, it seems they’ll keep on keeping on for the time being. But, how are they really feeling? Interestingly, despite YouGov reported a rise in consumer confidence in July after seven straight months of it falling. Overall consumer confidence index rose by 2.0 – the first increase since November 2021.
Yet, further research by YouGov found that one in four people have had to cut essential spending due to the cost of living crisis. With four in ten Britons saying they have struggled with food bills (42%) and energy bills (41%) in the past three months, retail spending is likely to be far from a priority for most people.
On a more positive, and slightly bizarre note, YouGov also found that half of Britons wish they could bring back Woolworths! Even a third of 18-24 year olds who were only aged 4-10 when Woolies closed would want to see it come back.
Similarly, there are positive trends bubbling away when it comes to seasonal events. A new YouGov study finds that 58% of all global consumers say they increased their expenditure for annual seasonal events over the last 12 months compared to their average monthly spend throughout the year. Christmas, Mother’s/Father’s Day and Cyber Week (Black Friday and Cyber Monday) came out on top as the most popular events for consumer’s annually.
Cyber Week will be here before we know it and zooming in on these seasonal shoppers, YouGov found they are more likely to spend a little extra on things they don’t necessarily need. They’d have loved Woolworths!
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Get in touch to start playing your retail customers the kind of background music that creates hair-tingling moments.
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