The rising cost of living and worries are having significant effects on how consumers shop, with data showing that UK shoppers are increasingly focussing on quality, convenience, value for money and ‘insperiences’, buying more takeaways and digital entertainment.
According to a survey of 2,000 UK consumers by American Express, more than three quarters (77%) of British consumers are increasingly focused on value for money, with 71% saying they proactively look for sale items when shopping. It’s also clear that customers are looking for more support from businesses on price, with almost seven in 10 (68%) believing that retailers could do more to help counter rising prices.
The research also points to signs that the retail environment is set to become even more competitive, as almost a quarter of shoppers (23%) are seeking out the best deals rather than sticking with their usual retailers. Additionally, over half (52%) of consumers say they are more likely to shop with a retailer that has a loyalty scheme, and 61% believe retailers can do more when it comes to rewarding them for their custom; indicating loyalty schemes are becoming a key differentiator for consumers.
Unsurprisingly, six in 10 (60%) respondents say a convenient shopping experience remains a high priority when spending with a retailer. But with two thirds (65%) valuing businesses that accommodate last-minute purchases and quick delivery, retailers need to keep a positive customer experience front of mind to stay ahead of competitors.
Against a backdrop of escalating cost-of-living pressures, the quality of products is also being interrogated; 62% of UK shoppers believe they have seen a dip in the quality or size of products in the last few months as retailers grapple with supply chain challenges, with almost half (47%) citing they prefer to buy fewer, better-quality items.
Daniel Edelman, Vice President & UK General Manager, Merchant Services at American Express, comments: “People’s shopping priorities are understandably changing rapidly in line with the times, with a bigger focus on value and closer eye on quality. It’s important that retailers, as always, stay close to their customers and react quickly in response to their changing needs.
Not going out
A separate study by Barclaycard reveals that, to save money, many Brits (51%) are planning to spend more evenings at home over the coming months; opting to play board games (25%), stream films and box-sets (20%), and play video games (19%) rather than go out.
This, combined with the arrival of autumnal weather, perhaps explains why some ’insperience’ categories enjoyed a boost in September. Spend on takeaways and fast food saw its highest rise (10.1%) since March this year, while digital content and subscriptions, including gaming and sports streaming services, saw growth (1.6%) for the first time in eight months – possibly tied to new video game releases such as ‘FIFA 23’, or pre-orders for popular titles such as ‘Call of Duty: Modern Warfare II’.
The entertainment sector also enjoyed an uplift, rising 1.3% after seeing a slight dip last month (-1.3%), likely due to Brits taking trips to the theatre and attending live music events in the last weeks of summer.
Despite ongoing inflationary pressures, confidence in household finances has remained steady (59%) since last month (60%), though this is a notable decline from the level of confidence two months ago (66%) and an even steeper drop compared to a year ago (68%).Esme Harwood, Director at Barclaycard, adds: Brits are also looking for ways to enjoy themselves at home while saving money, which has led to growth across “insperience” categories such as digital subscriptions and takeaways. It is likely to remain a challenging time for many other sectors as consumers focus on essential
