Consumer card spending in November 2023 experienced a 2.9% growth compared to the same period last year. Although this growth is less than the latest inflation rate of 4.7%, it surpassed October’s 2.6% increase.
Brits’ confidence in spending on non-essential items reached 56%, the highest level since April. The high street benefited from Black Friday sales and the arrival of cold weather, motivating shoppers to update their winter wardrobes.
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In contrast, spending on essential items increased by 3.3%, a slight dip from October’s 3.9%. Decreased fuel spending, notably due to lower petrol and diesel prices (-10.9%), played a role.
Supermarket growth also slowed (5.0% versus 5.2%) as shoppers sought ways to cut grocery bills, with 50% using vouchers and 49% opting for budget or own-brand goods.
Shoppers anticipate spending an average of £105.43 more on Christmas this year. Rising costs and ‘shrinkflation’ contribute, with 60% noticing smaller sizes at the same cost.
Shrinkflation affects items such as chocolates (36%), biscuits (28%), cheese (15%), mince pies (14%), and Christmas cakes (13%).
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By GlobalDataBlack Friday boosts non-essential spending
Spending on non-essential items increased by 2.7% in November, exceeding October’s 2.0%. The retail sector benefited from early Black Friday sales and seasonal weather changes.
Clothing retailers (2.8%) and department stores (5.0%) experienced notable increases as shoppers seized promotional sales opportunities.
Despite a slight decline (-0.6%) in Black Friday transaction volumes compared to 2022, Black Friday wasn’t the busiest shopping day in November. ‘Super Sunday’ surpassed Black Friday by 13.5%, emphasising the evolving nature of shopping patterns.
Brits actively seek deals, with 59% doing so due to rising costs, and 56% using loyalty programmes for discounts.
Travel sector sustains double-digit growth
The travel sector continued its robust performance in November, registering double-digit growth for 11 out of the last 12 months. Both travel agents (9.2%) and airlines (14.0%) experienced significant upticks.
The trend, dubbed ‘revenge spending,’ stems from 19% of consumers planning more holidays in 2024 to make up for trips missed during lockdowns.
Esme Harwood, director at Barclays, said: “November marked a turning point for consumer sentiment, with Brits feeling less concerned about defining issues such as inflation, interest rates, and food prices. This optimism, coupled with increased spending, sets a cautiously optimistic tone for the upcoming Christmas and New Year.”
Jack Meaning, UK chief economist at Barclays, added: “Consumer spending growth, while still below inflation, shows a narrowing gap. As shoppers overcome unseasonal weather and indulge in festive purchases, the key question remains about sustained spending in 2024 beyond the holiday season.”
