Barclaycard consumer spending report for February 2018
Barclaycard, who process nearly half of all consumer transactions in the UK, have released their February 2018 consumer spending report. The report shows a 3.8% increase in consumer spending compared the same period last year. The report makes the following main observations:
- Supermarket spending growth has “softened” compared to recent months. It was 3.2% compared to same measure in January which was 4.4%.
- Entertainment growth was a strong 7.4%. The consumer report cites Marvel’s recent Black Panther release as significant contributor to this. There is an overall trend that UK consumers are spending more on experiences. This includes travel, hotels, and restaurants etc.
- The report also suggests that consumer confidence is low amongst UK households, and suggests Brexit as a main reason for this.
How did our customers fare?
The report mentions many of the business types Geopify supports, as listed below. In most areas there was growth, but it was modest and there was a particularly disappointing performance for household appliances.
Growth by category:
|Category||Year-on-Year Consumer Spend growth by category|
Floor Covering Stores
Notably there continues to be a shift from in-store spending, towards online spending.
How did your business perform in comparison to these results?
Hopefully you out-performed them, but don’t panic if you didn’t as there is action that you can take:
- The first step is identifying if you have an issue. This Barclaycard report is useful and it can be compared to your sales data. By understanding there is a problem it allows you to take the next steps to reverse it.
- Secondly, if you are behind on growth then your competition is in front. What are they doing differently? Conduct some competitor analysis to understand what is happening and then take action.
- Get proactive with your customer retention strategy and do not wait until you discover a customer retention issue. The best way to stop customers from abandoning your services is to constantly try to retain them, even if you feel like you have a loyal customer base. This will give you the best chance of creating growth.
When using consumer spending reports understand that it is not the whole picture
These numbers are a snapshot in time, compared to another snapshot in time. They do not factor in market conditions within the two periods, so do not offer comprehensive trends-over time.
There is additional information required to complete whole picture:
- Are there factors that could be skewing the numbers?
- Were there more offers in February 2017 compared to February 2018?
- How do GBP exchange rates affect your business? If your products have become more expensive to manufacture or buy, how does this affect your pricing? More costly products can often lead to a decline in sales. Or maybe your business benefited from an exchange rate change?
- February is the start of the year, so how did your seasonal performance impact your early year strategy? For example, did you develop an aggressive new year sales program in early 2017 in response to a sluggish 2016 Christmas period?
- Were there any new initiatives that your company deployed in early 2018? How has this impacted performance and how does this compare to the market category?
- Even if your business had declining sales was it actually that bad? For example, a 5% decline in sales in a market where there has been a 15.4% decline could be viewed as pretty good.
The data in this report represents the spending of Barclaycard customers. Whilst they have vast amounts of transactional data it does not represent the whole country or all demographics. These types of report can contribute to your understanding of your market, your position within it and can help inform strategy. However it is not the full picture. So build up a broader view if what is happening and take appropriate action.
Source of data: Barclaycard Plc