Consumer spending fell 13.8 per cent in February as lockdown continued, yet some sectors saw record growth
- Spending on essential items grew 5.3 per cent year-on-year as online grocery shopping surged
- Food and drink specialist stores, which includes butchers, greengrocers and fresh food box services reached a record high of 63.3 per cent growth
- Spending on non-essentials dropped 22.1 per cent, as much of the high-street remained closed
- Confidence in the wider UK economy rose to its highest point in the past 12 months
- The Barclaycard report combines hundreds of millions of customer transactions with consumer research to provide an in-depth view of UK spending
Consumer spending fell 13.8 per cent year-on-year in February as lockdown restrictions continued, yet some sectors saw record growth as the first signs of spring lifted the nation’s spirits.
Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on essential items grew 5.3 per cent. Boosted by food and drink specialist stores – including butchers, greengrocers, fresh food box and meal-kit services – the category saw record growth of 63.3 per cent, 7.5 per cent higher than reported in January.
Supermarket expenditure was up 17.4 per cent overall, with online grocery spend surging 115.2 per cent as many Brits continued to rely on home deliveries for food shopping. Fuel spend, however, declined 30.2 per cent, as travel restrictions and working from home kept commuters off the roads.
As much of the high-street remained closed, spending on non-essential items declined 22.1 per cent year-on-year. The hospitality and leisure sector also had another challenging month, with overall spend down 68.9 per cent compared to February 2020. Within this category, pubs and bars saw a 95.7 per cent decline, while spending at restaurants fell 84.6 per cent.
Spending at discount stores was a bright spot however, up 32.3 per cent, as over half (56 per cent) of Brits say they’ve become more careful to seek out value in the purchases they make.
In an ongoing lockdown trend, spending on digital subscriptions and takeaways rose 42.6 per cent and 30.0 per cent respectively, as couples celebrated Valentine’s Day with date nights at home and a fifth (20 per cent) enjoyed a takeaway to mark the occasion.
With spring approaching, home improvement and DIY spend saw a 10.3 per cent increase as nearly a third (32 per cent) of consumers say they are looking forward to ‘spring cleaning’ and sprucing up their homes. Furthermore, furniture stores saw a smaller year-on-year decline in February than in January (-4.5 per cent, compared to -14.6 per cent). This comes as 35 per cent of those wanting to spend more on spring cleaning say they’re planning to purchase furnishings to redecorate or update a room.
Online retailers continued to see strong growth, with online sales accounting for 53.7 per cent of all retail spend in February. Spending at online general retailers, such as online marketplaces and catalogue shops increased 100.0 per cent, while online specialist retailers – including florists and jewellery stores – saw 95.9 per cent growth, as Brits bought presents for Valentine’s Day and lockdown pick-me-ups. Indeed, almost a quarter (23 per cent) said they are more willing to spend on treats for themselves and family compared to last month.
Confidence in household finances held up at 68 per cent, with more than two fifths (42 per cent) of consumers saying they have saved more money than usual since the pandemic began. However, many are already thinking about where to spend their savings, with a fifth (20 per cent) of those who have saved more than normal saying they will take a big holiday with the extra money they have saved and 13 per cent are planning to treat themselves to something nice. Meanwhile, confidence in the wider UK economy rose 4.0 per cent from last month to its highest point in the past 12 months (28 per cent).
Raheel Ahmed, Head of Consumer Products, said: “Despite a very challenging environment, it’s inspiring to see many retailers remaining resilient and doing what they can to maximise online sales while physical stores remain closed. In addition, as we all spend more time at home, we’ve seen home subscription services, fresh food boxes and meal-kit services become a popular mainstay of life in lockdown.
“The start of Spring, the Government’s roadmap out of lockdown, the vaccine roll-out and the extension to the stamp duty holiday are contributing to a lift in the nation’s spirits. With consumers generally feeling more optimistic, there is a strong indication of a more prosperous period to come as the long-awaited recovery and life after lockdown begins.”
|Spend Growth||Transaction Growth|
|Food & Drink Specialist||63.3%||17.7%|
|Home Improvements & DIY||10.3%||6.1%|
|General Retailers & Catalogues||75.7%||78.9%|
|Pharmacy, Health & Beauty||-32.4%||-38.1%|
|Sports & Outdoor||-12.5%||-41.0%|
|Other Specialist Retailers||0.0%||-17.0%|
|Hospitality & Leisure||-68.9%||-56.1%|
|Eating & Drinking||-46.8%||-47.9%|
|Bars, Pubs & Clubs||-95.7%||-97.0%|
|Takeaways and Fast Food||30.0%||-7.4%|
|Other Food & Drink||-62.9%||-53.1%|
|Hotels, Resorts & Accomodation||-71.9%||-85.4%|
|Digital Content & Subscription||42.6%||35.7%|
– Ends –
Notes to editors
Established in 2014, Barclaycard issues a monthly press release commenting on consumer spending trends.
Barclaycard sees nearly half of the nation’s credit and debit card transactions, which provides us with unique insight into UK consumer spending. The monthly spending data in this press release is based on Barclaycard credit card and Barclays debit card transactions, and is analysed by the Barclays Market and Customer Insights team. It relates to the period 23rd January 2021 to 19th February 2021. It is compared with 25th January 2020 to 21st February 2020.
The consumer confidence survey in this press release was carried out between 19th and 22nd February 2021 by Longitude Research on behalf of Barclaycard. There were 2,003 respondents, providing a representative sample of UK consumers by age, gender, region, and income group.
For more information, please contact please contact Oliver Stevenson at email@example.com or on +44 (0)7880 184 177 or Rebecca Butler at firstname.lastname@example.org or +44 (0)7881 318 767.
Barclaycard, part of Barclays Bank PLC, is a leading global payment business that helps consumers, retailers and businesses to make and take payments flexibly, and to access short-term credit. In the UK we process nearly £1 in every £3 spent using credit and debit cards, and in 2020 we processed over £267bn in transactions globally. We also partner with a wide range of organisations across the globe to offer their customers or members payment options and credit.
Follow us on Twitter @BarclaycardNews
About Barclays Market and Customer Insights
Barclays Market and Customer Insights helps businesses keep up to date with spending trends, monitors their market position and enhances their understanding of customer behaviour, based on actual customer spending. Visit insights.uk.barclays/MCI or email contact-MCI@barclays.com.