Changes In Consumer Spending Patterns in The UK Post-Pandemic

The COVID-19 pandemic has triggered shifts in consumer spending and behaviors in the UK retail landscape. While total household consumption remains below pre-pandemic levels, share of spending across categories has evolved along with preferences for omnichannel retail.

Spending on experiences and services has seen strong resurgence after lockdown easing with over 25% growth in entertainment and hospitality (McKinsey & Company, 2022). In contrast— share of retail goods spending has declined by 3-4% as ownership models shift from buying to rental access for some items.

E-commerce has risen to account for over a third of total retail sales from under 20% pre-pandemic (ONS, 2022). Over 70% of consumers indicate they now shop online more frequently for items like groceries and homeware. Retail sites optimizing user experience through tools like virtual try-ons will further digital adoption.

Consumers also increasingly factor sustainability impacts into purchase decisions. Over 50% are willing to pay more for ethical and eco-friendly brands per IPSOS surveys (2022). Retailers focusing on localism, transparency and circular models around reuse/recycling have an edge.

Technology use has elevated across the shopping journey. Over 60% employ digital methods like- social media ads, review sites and product filters when researching products. Seamless omnichannel integration where online, mobile, apps and in-store interactions become blended continues rising in importance to customer experience.

Younger consumers especially have embraced the sharing economy for items previously owned individually. Ride-hailing, bike rentals, clothing rentals and peer-to-peer accommodation services have seen 50-100% growth since 2020 (Statista, 2022). Retailers may tap into these trends through rental/subscription models for electronics, home goods and luxury items.

Spending on experiences has also become more community-driven as people seek social connections. Pop-up local events around food/drink, art/music and outdoor activities curated through collaborative platforms allow independent businesses to participate.

The pandemic highlighted inequalities in essential spending. Groceries, utilities and healthcare account for a higher share of lower-income household budgets. Social enterprises enabling greater access through community support networks, income-based pricing and digital inclusion can help address such disparities.