Did we spend less and save more in 2020? According to Barclaycard, the answer is yes. The credit card provider published its consumer spending report on New Year’s Eve, and the findings highlight significant growth in the e-commerce sector, despite the overall regression.
The research showed a 7.1 per cent drop in consumer spending over 2021, as Brits hunkered down in the wake of the COVID-19 lockdown. But our lifestyle changes fuelled growth in some sectors, including e-commerce. Non-essential online retail experienced a massive spike of 52.5 per cent, underlining the shift in our buying habits.
Digital demand up
What Barclaycard referred to as the “insperience economy” got a boost during 2020, as we went all-in on digital entertainment experiences – from subscriptions to games consoles and box sets. Perhaps unsurprisingly, ordering takeaways online increased by 49.1 per cent, as hassle-free dinners at home became the norm for many.
Raheel Ahmed, Barclaycard’s Head of Consumer Products, said: “We have seen many businesses become more agile and move online and the demand for online groceries, digital entertainment and subscriptions has been huge. Home improvement, DIY & gardening have also seen a boost, as we all spend more time at home and near our local communities.”
He concluded: “Hopefully with a vaccine being rolled out in 2021 we will see green shoots for the most severely impacted sectors. Having said that, some of the trends and changes we’ve seen in customer habits may be here to stay.”
High street retail and hospitality were two sectors to bear the brunt of ‘stay at home’ order, but there is evidence that Brits are spending more in local specialist shops such as bakeries and butchers.
How did they do it?
Barclaycard put together its report based on millions of consumer transactions, along with consumer research, giving them an in-depth overview of spending in the UK last year.
Another study conducted by Aldermore Bank recently showed us that Brits have become a nation of super savers with our extra time spent at home. They say that working from home has led us to save an average of £110 a week, and £2,860 over a six month period.
Ewan Edwards, director of savings at Aldermore, said: “Our data shows how little savings here and there can in the long term add up to big rewards, and many Brits are now seeing the benefits of better saving routines.”
The research begs the question – with the money consumers put aside in 2020, and our growing propensity to buy online – are we set for a huge e-commerce spending boom in 2021?