As we approach the end of the year the gloomy economic reality is being increasingly felt by UK consumers. Spending habits are changing as people reassess what their personal budgets can continue to accommodate and what they can no longer justify spending money on. Understanding these trends is of critical importance for brands as understanding exactly how consumers view their discretionary spending is vital heading into a recession. We have delved into the UK consumer’s attitudes to spending using the online survey tool Global Web Index (GWI) to help give you a better picture of the person behind the platform heading into the Christmas spending season.

“81% of internet users admit to being more cautious with their spending this year”

It almost goes without saying that there is a growing sense of pessimism and caution when it comes to consumer spending, with 81% of UK internet users admitting to being more cautious with their spending in Autumn. The increased prices of many products are an immediate concern for over 50% of UK consumers. Even so, UK consumers are still willing to spend on treats for themselves, the most common treat-purchases being clothing (16.7%), travel (11%), dining out (7.8%) and day’s out/experiences (7%). We are also seeing a greater emphasis being placed on the quality of an item when it comes to purchases - this is as important a factor as cost with it being a key factor for consumers deciding on a purchase with 66% of consumers citing them both as important.
In terms of where consumers are most price conscious this year it is unsurprisingly those purchases which are unavoidable or everyday which are concerning consumers the most. Food and groceries (74.1%), utilities (70.2%) and transport (47.6%) top this list, showing the impact of inflation and the cost-of-living crisis. Brands in these spaces are going to need to work hard to demonstrate that their products are worth the price they retail at to consumers. That is not to say that UK consumers are only being cautious in these areas. Consumers are making an effort to spend less when it comes to clothing (40.1%), out of home entertainment (38.1%) and tech and electronics (18.3%). It remains to be seen how these trends will hold up during the retail peak in the run up to Christmas - but what we do know is that this final quarter of the year is likely to be a challenging time for brands and consumers alike.

“Marketers need to maximise the value that their brand delivers to their customer”

As we have seen, there are products and services which consumers are still willing to spend their money on as treats for themselves. However, it is worth noting that it’s likely this situation is likely to continue to develop and change into next year.

Looking ahead to 2023 is difficult but, with the likelihood being that customer’s personal finances continue to be squeezed, brands need to take the necessary action now to ensure that they’re maximising the value that their brand delivers to their customers. This is why at Communicator we’re all about putting the audience first using our Person Behind the Platform methodology - allowing us to get a full understanding of where the opportunities are for our clients’ brands to create highly resonate content which adds value to the audience.

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