Is getting entertained at home a way to beat cost?
According to new data, consumers ate out less in March to save money and instead entertained at home. This meant that sales of home items and furnishings increased dramatically.
According to the British Retail Consortium (BRC), the phenomenon of consumers getting entertained at home helped raise retail sales by 5.1% last month compared to the previous year.
It comes at a time when the cost of living remains high, putting further strain on families.
Inflation, or the rate at which prices rise, increased by 10.4% in the year leading up to February.
According to the BRC, sales in March were “brightened up” by Mother’s Day, when customers purchased jewelry, flowers, and perfumes.
Yet, the rainiest March in almost 40 years discouraged consumers from purchasing clothing, gardening materials, and do-it-yourself things.
But, according to the BRC and the accounting firm KPMG, home accessories and furniture sales went up the most during the month. This was the most growth of any category.
Paul Martin, in charge of retail in the UK for KPMG, said people entertained at home to save money. He also said that the trend would continue in April because council tax, cell phone, and utility bills were increasing, and personal tax allowances remained the same.
“Consumers will have to spend less on things they don’t have to,” he said. “Consumers will continue to change where they shop, what they buy, and how much they spend on fewer items to save money where they can.”
Getting entertained at home: What the numbers say
Barclays released a report on Tuesday showing people ate out less in March. However, as people spend more time or entertained at home, they spend more money on streaming services.
The bank said consumer card spending rose by 4% in March compared to last year’s.
Since October last year, digital content and subscription spending has grown the most as more people entertained at home. New seasons of TV shows like Succession and Ted Lasso were a big reason for this.
IGD, a retail research company, said that grocery stores would look for other ways to keep customers happy as food prices kept going up.
“They try to give customers a good deal by offering loyalty programs, good private label products, and meal solutions that let people re-create restaurant experiences at home,” said boss Susan Barrett.
Even though there are problems, the BRC said that consumer confidence was “edging up” and that big events like the coronation of the King in May would likely help retailers.
But boss Helen Dickinson warned that businesses still face “extensive” cost pressures, such as rising wholesale prices and wages.
“If these future costs aren’t brought down, high inflation will likely keep going for UK consumers, who are already seeing their bills go up as of this month,” she said.
The Bank of England thinks inflation will go down later this year when food and energy prices go down. However, after an unexpected jump in the UK inflation rate in February, Bank governor Andrew Bailey has warned businesses not to raise prices too quickly.
Analysts predicts Good Friday buying habits
Even as people entertained at home, the number of people shopping on the first day of the Easter holiday weekend “exceeded all expectations,” but it is still lower than before the pandemic.
Analysts at MRI Springboard said more people were on the high street on Good Friday than the week before or the same time last year.
People also went to retail parks and shopping centers more.
At more people entertained at home due to COVID, overall visitors fell by 11% from 2019 to 2020.
MRI Springboard said the results were “a continuation of strong activity” from earlier in the week when people used the time off from school before Easter to shop.
Diane Wehrle, who is in charge of insights at MRI Springboard, said that while people went to retail parks all day, they went to high streets and shopping centers “later in the day.”
Overall, 18.6% more people went to UK destinations this week than last. Compared to 2022, this was a 3.6% increase.
Since 2019, the number of people shopping on high streets has dropped by 14.5%, more than retail parks and shopping centers.
The biggest increase from one week to the next was 55.1% in shops in coastal towns, where people went because the weather was nice. But compared to market towns and old towns, the number of people in the coastal area is still lower than last year and before the pandemic.
Even though the gap between foot traffic before and after the pandemic is getting smaller, partly due to more people choosing to be entertained at home, shoppers still have difficulty making ends meet because energy bills and grocery prices have gone up a lot.
The British Retail Consortium (BRC) said the recent number recovery has slowed because inflation is close to a 40-year high, and consumers and businesses are facing a “challenging economic environment.”
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The BRC also said that people are shopping more on weekends now that more people are going back to work during the week. However, even as more peopl entertained at home, the number of people shopping on weekends is still lower than before the pandemic, and a recent rise in numbers has slowed.