Unfortunately our website is not optimised for your browser.

Consumer spending grows 4.4% in October propped up by entertainment, while the retail sector continues to struggle

Mon Nov 05 19:01:00 EST 2018

  • Consumer spending increased 4.4 per cent year-on-year in October, maintaining a modest level of growth
  • Ticket sales rose 22.1 per cent after the release of Glastonbury Festival tickets and box office hits such as Venom and A Star is Born
  • The retail sector continued to struggle, with contractions in department store (-5.9 per cent) and clothing spending (-2.4 per cent)
  • 28 per cent of consumers say they have confidence in the UK economy – the joint lowest level since Barclaycard started monitoring consumer confidence in 2014

Consumer spending grew 4.4 per cent year-on-year in October, maintaining a modest level of growth, as the retail sector continues to face challenges.

Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, shows that essential spending rose 4.8 per cent year-on-year, as petrol expenditure remained high with 10.3 per cent growth.

Non-essential expenditure, meanwhile, demonstrated a reasonable increase of 4.1 per cent. Entertainment was the driving force behind this, rising 10.8 per cent – powered by strong performances from pubs (11.7 per cent) and restaurants (8.6 per cent).

Entertainment was also boosted by ticket sales which performed particularly well at 22.1 per cent growth. This follows Glastonbury Festival tickets going on sale after the festival’s fallow year, alongside blockbuster film releases such as Venom and A Star is Born.

The retail sector, however, continued to struggle. Department store spending contracted by 5.9 per cent amidst high profile store closures, while spending on electronics reached just 1.8 per cent growth, below the rate of inflation. Clothing spending also declined by 2.4 per cent – the biggest dip since October 2017.

This slowdown in clothing spending could be due to the warmer-than-usual weather experienced during much of October, as a fifth (19 per cent) of consumers say they have postponed making winter wardrobe purchases this year.

More broadly, stronger average earnings growth in the UK helps explain why one fifth (19 per cent) say their wages have gone up enough for them to have a little more money to spend each month. Yet Brits remain cautious with their money. Of those with more money to spend following a pay rise, half (49 per cent) are saving their extra money or paying off debt, and a third (36 per cent) are currently putting it towards Christmas.

This caution reflects wider opinion of the nation’s economy. Just 28 per cent of UK consumers now say that they have confidence in the UK economy – the joint lowest level since Barclaycard started monitoring consumer confidence in 2014.

Esme Harwood, Director at Barclaycard, said: “While the retail sector has continued to face challenges, the experience economy provided a welcome boost to overall spending in October with consumers going for meals out, and purchasing tickets to events and shows.  

“Ongoing economic and political uncertainty has led to a decline in confidence, with consumers remaining cautious with their spend in the run-up to Christmas.”

 

Y/Y Spend growth by category

Overall

Clothing

-2.4%

     Family Clothing

-3.0%

     Shoe Shops

-2.3%

     Women’s Clothing

-1.2%

     Men’s Clothing

0.0%

Restaurants

8.6%

Auto Parts & Accessories

3.7%

Cinema, Theatre & Dance

22.1%

Public Houses

11.7%

Department Stores

-5.9%

DIY Stores

2.0%

Travel Agents

6.8%

Airlines

0.4%

Supermarkets

2.3%

Petrol

10.3%

Gambling

17.0%

Vehicle Sales

-3.3%

Hotels

3.2%

Auto Repair Shops

1.9%

Sports Shops

-1.4%

Furniture Stores

3.7%

Telecoms

2.9%

Household Appliances

-14.3%

Jewellers

-6.1%

Sports and Games Establishment

0.3%

Garden Centres

7.2%

Discount Stores

-13.7%

Gift Shops

-5.6%

Floor Covering Stores

-1.3%

Tourist Attractions

0.5%

Amusment Parks

6.2%

Aquariums

25.2%

Electronic Stores

1.8%

Cosmetic Stores

4.7%

Optical Goods

5.6%

 

Overall

4.4%

 

Average Transaction Value

Overall

-4.6%

 

Clothing

-0.8%

 

Airlines

-7.6%

Restaurants

-4.7%

Supermarkets

-3.8%

Petrol

3.4%

 

Number of Transactions

Overall

9.5%

 

Clothing

-1.7%

Airlines

8.6%

Restaurants

14.0%

Supermarkets

6.4%

Petrol

6.7%



Notes to editors


For more information please contact Rebecca Butler on +44 (0) 207 116 1993 or Rebecca.Butler@barclaycard.co.uk, or Phillipa Russell on +44 (0) 207 116 5473 or Phillipa.Russell@barclaycard.co.uk.

The monthly spend data in this release relates to the period 23 September to 20 October 2018. It is compared with 23 September to 20 October 2017.

The consumer confidence survey was carried out between 22 and 23 October 2018 by Longitude Research on behalf of Barclaycard. There were 1,802 respondents, providing a representative sample of UK consumers by age, gender, region, income group, professional status and family situation.

*Online and In-store splits of Spend insights data are not available at the time of publishing, data will be updated once available.

About Barclaycard

Barclaycard is a leading global payment business that helps consumers, retailers and businesses to make and take payments flexibly, and to access short-term credit and point-of-sale finance. In 2017 we processed over £250bn in transactions globally. Barclaycard is a pioneer of new forms of payment and is at the forefront of developing viable contactless and mobile payment schemes for today and cutting-edge forms of payment for the future. We also partner with a wide range of organisations across the globe to offer their customers or members payment options and credit.

home.barclaycard

Follow us on Twitter @BarclaycardNews