According to recent reports, British consumers are feeling the pinch of rising living costs; however, they are still prioritizing purchases in the fashion and beauty sectors. The British Retail Consortium and KPMG’s retail monitoring report for April indicated a 0.3% year-on-year decline in total sales, marking the first drop in 15 months. Like-for-like retail sales also decreased by 1.7%, with retailers selling big-ticket items being particularly affected. However, the report highlighted that spending on gardening and fashion remained strong.
Amongst these categories, the fashion industry experienced a notable surge in sales, especially in occasionwear. After enduring the impact of lockdowns, consumers now have the freedom to attend weddings, go on holidays, and participate in social events. As a result, they are keen to update their wardrobes accordingly. This trend aligns with Barclaycard’s latest figures, which reported an 18.1% increase in consumer card spending compared to the same period in 2019, the largest surge since October 2021.
The recovery of the travel sector has significantly contributed to this boost in consumer spending. Although travel expenditure is still lower than pre-pandemic levels, it is steadily rebounding. As people plan their vacations, they are also investing in new clothing and accessories, thereby contributing to the growth of the fashion industry. Additionally, the reports reveal that Britons are economizing across various categories, opting for cheaper alternatives and reducing their use of expensive items like cars.
Taking a deeper dive into travel and social activity spending, accommodations have experienced a 16.6% increase compared to three years ago, whereas travel agents and airlines have seen slight declines of 3.5% and 9.9%, respectively. Approximately 21% of the population has made plans for the long weekend in June to celebrate the Queen’s Platinum Jubilee, while 17% are allocating more funds for special occasions and holidays this summer, seeking to make up for lost time during the past two years.
For the fashion and beauty sectors, these findings are promising. Among the demographics mentioned above, new clothes and accessories were the most popular purchases, with 27% investing in fashion and 13% in beauty products such as fake tan and make-up. This consumer behavior is reflected in retail spending, with clothing experiencing a 12.6% increase in April, surpassing March’s growth of 10.1%. Department stores have also witnessed a turnaround, recording a 1.3% increase after seven consecutive months of decline. Pharmacy, health, and beauty stores saw an even more significant improvement of 20.2% compared to the previous month’s 18.8%.
In conclusion, despite the challenges posed by rising living costs, British consumers are still allocating funds for fashion and beauty purchases. The recovery of the travel sector and the desire to engage in social activities have contributed to the growth of these industries. With the upcoming summer season and special occasions on the horizon, it is expected that consumer spending in the fashion and beauty sectors will continue to rise.
Useful Links:
– BRC-KPMG Retail Sales Monitor
– Barclaycard Spending Surge
