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Britons splash out on ‘nice-to-haves’ as confidence in economy continues to grow

Barclaycard's latest spend report finds consumers spending more on non-essentials as record-low inflation makes the pound go further.

Tue Apr 14 00:00:00 EDT 2015

  • Barclaycard spend data shows consumers starting to treat themselves again
  • Consumers in Q1 spent more on personal electronics and eating out
  • Britons feel more confident about indulging on non-essential items 

British consumers in Q1 spent more on certain key discretionary items than they did in Q4 2014. For example, year-on-year growth in Q1 on furniture was five per cent, up from one per cent in Q4 while spend in restaurants was 17 per cent, up from 16.4 per cent in Q4. At the same time, 59 per cent of respondents to our consumer survey say they are feeling confident about their ability, at the current time, to splash out more on non-essential items.

Falling prices and a stronger economic outlook may have given consumers the confidence to spend more freely. In February, the UK rate of CPI inflation dropped to 0 per cent1, which will have made the cost of living seem more affordable for many. In our survey, almost a third (31 per cent) say that, as the cost of essential items falls, they find they can spend more on themselves and others.

consumer spending forecast

Almost half (45 per cent) also say they are feeling positive about the strength of the UK economy, up from 38 per cent three months ago. And three quarters (74 per cent) are no longer worried about living within their means each month – eight per cent more than in Q4 2014.

But one possible dampener on this optimistic mood is the upcoming General Election. The majority of consumers (56 per cent) say they are concerned about its impact on their personal or household finances. 

In this report, we explore where and why consumers are spending. Our focus on electronics and entertainment shows how some of today’s trends may play out over the next few months. After spending on electronics grew by 6.6 per cent year-on-year in Q1, our confidence survey suggests several million Britons could buy the ‘next big thing’ – a smartwatch – this year. And, after spending on entertainment grew by 11.9 per cent year-on-year, we find consumers thinking they have been ‘cautious for a long time’ and want to treat themselves for a change. 

In this report, we explore where and why consumers are spending. Our focus on electronics and entertainment shows how some of today’s trends may play out over the next few months. After spending on electronics grew by 6.6 per cent year-on-year in Q1, our confidence survey suggests several million Britons could buy the ‘next big thing’ – a smartwatch – this year. And, after spending on entertainment grew by 11.9 per cent year-on-year, we find consumers thinking they have been ‘cautious for a long time’ and want to treat themselves for a change.

Consumers have a brighter economic outlook. It’s giving them an impetus to go out and spend

Rob Gregory, Global Research Director, Planet Retail 

The Regional Perspective - who's spending where?


Towards the end of 2014, we saw the largest growth in spending taking place in London, the South East and Northern Ireland. While London still showed the largest year-on-year growth in Q1 2015, the North West and the West Midlands were competing for second and third place – with growth at 4.1 per cent and 3.6 per cent year-on-year respectively.

The spending data is consistent with the findings of our consumer confidence survey. In London, 64 per cent of consumers say they feel confident about spending more on non-essential items, as do 62 per cent of consumers in the North West. In the West Midlands, 58 per cent feel the same. Looking ahead, however, London, the South East and the East Midlands are the regions that expect to increase spending the most in the next three months. 

See our latest consumer spending reports 

Regional spend data
Consumer spending quote

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