Consumer spending surges in July 2018
The British public have been making the most of hot weather. July 2018 saw a 5% increase in consumer spending compared to July 2017. This was helped along by England’s progress in the World Cup which I predicted last month.
Barclaycard process nearly half of the UK’s card transactions and so are well positioned to report on how the British public spend their money. The main highlights from the report:
- Consumer spending was up 5% year on year.
- Essential spending increased by 8.7%. This included a 6.7% increase for supermarkets and a 13% increase on petrol, which is relatively expensive right now.
- Pub spending was up by a massive 16.8%, this was driven by the heatwave and England’s progress through the World Cup. In fact, pub spending was up 73% for England’s semi final.
The Hot weather
The British public have been making the most of the sunshine. There has been an increase in spending on experiences such as day trips and other outdoor activities. Other beneficiaries of the hot weather were women’s apparel and garden centres, which saw strong growth of 4.5% and 8.1% respectively.
The World Cup
As the England team went further in the tournament Brits reached further into their wallets at the bar. Overall spending in pubs was up 41% on matches days compared the equivalent days last year.
Despite spending heating up there is a sense of caution. Shoppers remain concerned about the wider economic picture. Household financial confidence is at 59%, 6% lower than last month.
Rising interest rates is another area of concern. A third of the UK public are worried that the recent bank of England rate rise will result in less cash moving forwards.
Director at Barclaycard, Esme Harwood said:
The prolonged warm weather combined with England’s World Cup performance has created a short-term boost in spending. With the sunshine showing no sign of abating, spending levels have remained higher than we would normally expect with Brits keen to make the most of the heatwave whether in the pub over a few drinks or stocking up at the supermarket to enjoy a barbecue.
It will be interesting to see if this strong level of growth continues as we move into the final stretch of summer. It’s clear that some consumers remain cautious about what’s to come with interest rates rising and overall confidence in household finances down slightly from June.
Our customer’s segments:
|Year on Year change|
|Floor Covering Stores||-5.40%||9.20%||-6.90%|
This shows a mixed set of results. DIY and garden centres fared very well. These particular categories do well when the weather is good. Other areas such as household appliances dropped. Overall online sales continue to show strong growth. The important next step is to review your results and compare them to your industry statistics such as these reports. Consider what you can do buck the trend and increase sales.
Click here for the article’s source data
*I am not sure who is buying petrol online! I also imagine the overall amount is low, so this likely to be a large percentage increase but from a very low base.