Consumers cautiously optimistic about spending plans for rest of year
New research has found that 71% of UK consumers purchased clothing in the last 12 months, with 41% buying healthcare or vitamin products, and 41% spending money on skincare and cosmetics. Despite a tough financial year for many, the data suggests that a significant proportion of consumers plan to either spend the same amount or more on such products this year, with e-commerce set to sustain its dominance in the coming months.
Almost three-quarters of consumers polled by retail technology expert Conversity (72%) said they will spend either the same amount or more online on jewellery this year as they did in 2020, with this figure also being 72% for clothing. 61% plan to maintain or increase their e-commerce spending on healthcare and vitamins this year, with 61% also saying the same for skincare and cosmetics.
Respondents were also asked how much they plan to spend on shopping online each month throughout 2021 (excluding necessities such as food). Almost six in ten consumers (59%) envisage spending between £51 and £250 per month on a range of non-essential purchases such as clothing, household items or electronics. This rises to 74% for those aged 18-24, and 66% for shoppers in the 25-43 age group.
While this may hint at growing consumer confidence, an element of caution is still very much present: almost a third of respondents (31%) say their monthly e-commerce spending will be limited to between £0 and £50. This is much higher in older consumers, rising to 48% for those aged 56-74.
Commenting on the findings, Brad Christian, Global Chief Customer Officer at Conversity, said: “The uncertainty of the last 12 months has meant many of us have reduced overall spending – which we have seen in the rocky performance of the retail sector in this time.
“As might be expected, the desire to spend more online varies considerably depending on age. Younger consumers appear eager to spend their hard-earned cash, possibly with the lifting of lockdown restrictions now on the horizon. Older shoppers are more circumspect, preferring to err on the side of caution for the time being.
“Despite this, there are signs from our research that consumers see light at the end of the tunnel, and hope to continue – or even increase – the amount they spend on certain products. Both new and repeat customers have engaged with e-commerce on a level never seen before, with the figures showing that online spending plans across several product categories look healthy despite the current circumstances. Given the headwinds that brands have felt over the course of the last year, the consumer optimism seen in this research suggests that the sector will see a robust recovery as 2021 moves forward.”
“All of this underlines the fact that consumer relationships remain highly complex during this period, so retailers should approach the situation carefully. This means having the processes and technologies in place to ensure they understand the individual needs of each customer.”
He concluded: “Effective e-commerce personalisation is key in this respect. If a customer can visit a website and get the guidance needed to help them find the right product first time, they can ensure value for money regardless of their budgets. Providing that peace of mind is more crucial now than ever: retailers that focus on humanising the online shopping experience will be the ones remembered by their customers further down the line.”