Consumer spending rises ahead of Christmas but retailers still feeling the pinch
Early Christmas shopping helped boost consumer spending last month but lockdown restrictions continued to hit retailers.
Spending dropped 1.9 per cent last month as restrictions took effect but spending on essential items climbed 4.9 per cent, according to the latest data from Barclaycard.
Supermarkets enjoyed a 17.9 per cent rise in sales with a staggering 97.4 per cent jump in online shopping ahead of Christmas.
Physical stores experienced an inevitable dip amid lockdown, with data from the British Retail Consortium (BRC) and KPMG also released today showing in-store sales of non-food items declined 18.6 per cent over the three months to November.
But Barclaycard’s data shows that general retailers and clothing enjoyed online rises of 73.9 per cent and 35.6 per cent respectively.
Early Christmas shopping also helped to boost online spend at specialist retailers – 85.8 per cent – a category which includes toy shops, jewellers and gift shops.
“Extended discount periods helped spread demand and offered customers great deals on gifts including the latest gaming consoles, other electronics and home accessories,” said Helen Dickinson, chief executive of the BRC. “However, the disparity between online and in-store non-food sales widened, with the highest online penetration rate since May.”
The rise in spending is in part because of steep discounting but also because people have been boosted by news of a vaccine rollout. Barclaycard’s data reveals a third of Brits say they are feeling more upbeat about their finances and job security as a result.
Similarly, confidence in household finances remained steady at 69 per cent, up slightly on the previous month at 67 per cent.
Raheel Ahmed, head of Consumer Products at Barclaycard, said: “Despite the restrictions in November, Brits are feeling more positive about their household finances as they start to prepare for the festive season. Christmas trees are going up just that bit earlier, and many are planning to spend more treating their loved ones after such a testing year.”