How are we spending lockdown?
The way we buy has altered, VICKY SHAW asks are those changes here to stay?
THE nation’s shopping habits have undergone dramatic changes in recent weeks. More people have turned to home deliveries, while many are also looking for ways to cut their spending due to a reduced household income.
Having slowly adjusted to new shopping routines, evidence is now emerging that some of the new habits formed during the coronavirus crisis may last beyond lockdown.
Here’s a look at how people’s spending habits have changed, and what impact it could have in the longer term...
HOW HAS CASH USE CHANGED?
CASH use had already been in a slow decline, but during the coronavirus outbreak the number of cash withdrawals being made from ATMs has fallen sharply.
According to figures from ATM network Link, transactions are down 60% year on year. Link’s consumer research suggests three-quarters (75%) of us are using less cash, though a signinficant minority still rely heavily on coins and notes with 23% using the same amount of cash or more.
HOW HAVE ONLINE SHOPPING HABITS CHANGED?
MORE than 430 million deliveries took place across the UK in just the first month of the lockdown, according to estimates from Nationwide Building Society. Its consumer research found people received an average of eight deliveries over the first month of the social distancing measures. This includes supermarket deliveries and other online shopping, food boxes and takeaway meals, medicines and drop-offs from family members, friends and neighbours.
Local shops are also adapting. The Association of Convenience Stores says around two-thirds of local shops now offer some form of delivery service – up from just over one in 10 in 2019.
WHAT’S THE IMPACT ON THE GROCERY SECTOR?
MARKET research agency Mintel predicts the online grocery market is set to grow by a third (33%) this year, to reach an estimated value of £16.8 billion. The boost is expected to last beyond 2020.
Mintel predicts the sector will continue to grow, reaching an estimated £17.9 billion by 2024.
Their research suggests many people are trying to limit the time they spend in-store and nearly one in 10 (9%) are using ‘click-and-collect’ services more.
WHAT ABOUT OTHER SECTORS?
MANY sectors have seen the impact from households reducing their spending and having fewer opportunities to socialise than usual.
Nationwide Building Society has analysed its customers’ current account spending, comparing the four weeks leading up to April 12 with the same period a year earlier.
It found that, despite some restaurants now offering takeaway options, spending on the restaurant sector was down by 70%. With fewer occasions to dress to impress, spending on clothing was down by 50%. But spending on hardware stores was up by a third (33%) as people spent more time at home and in the garden.
People have also been making the most of entertainment services from home. TopCashback.co.uk found two in five have signed up to new subscriptions, such as TV and music streaming, fitness regimes and product deliveries, since the coronavirus outbreak started.
SO WILL THESE CHANGES IN SHOPPING HABITS CONTINUE?
WHETHER it’s because they prefer some of their new shopping habits, or simply can’t afford to go back to their previous ways, it seems some people do intend to change their spending longer term.
According to Nationwide’s research, nearly two-thirds (62%) of people say their spending habits have changed – and around a third (32%) will be more mindful of their purchases in future.
With many households facing uncertain incomes, 31% will look to cut back on non-essentials. A quarter (25%) pledge to waste less food.
Mark Nalder, Nationwide’s head of payments strategy and service, says: “While the number of shopping deliveries has significantly increased since lockdown, overall spend has reduced.”
He says it will be interesting to see any changes people make, “especially as many say they are going to pay closer attention to their finances in future, be less wasteful and cut back on non-essential purchases”.
More then 430 million deliveries took place across the UK in just the first month of lockdown, it’s estimated.