Nearly half (45%) of UK consumers have been using savings accumulated during Covid-19 lockdowns to offset the cost-of-living crisis, according to new research from the Retail Technology Show (RTS), the industry’s leading event taking place on 24 & 25 April 2024 at London’s Olympia.
Original research of over 1,000 UK adults by RTS revealed that on average British consumers built up a Covid saving pot of £4,805, with Millennials reporting the highest levels of lockdown savings, amassing an average of £5,862.50 while Boomers reported the smallest pots at £4,069.20.
Despite the Governor of the Bank of England, Andrew Bailey, insisting the economy was already showing signs of recovering from a mild recession, more than a quarter (26%) of respondents expect the cost-of-living crisis to last beyond 2026, with a fifth (21%) expecting it to end in 2025.
While the British Retail Consortium’s shop price index revealed food inflation had slowed to its lowest rate for nearly two years, 45% of consumers report using Covid savings to supplement their lifestyle, top up household budgets or cover rising energy bills, with a third (34%) reporting their lockdown savings have now or will shortly be spent. Accordingly, nearly half (48%) of consumers identified themselves as being increasingly price sensitive, with 38% becoming more considered about each purchase they make and 35% spending more time searching for deals or the best price before purchasing.
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Conversely, more than a third (36%) say they haven’t yet spent their Covid-19 savings post – increasing to 50% of Baby Boomers and 42% of Gen X. However, credit rating agency, Fitch Ratings, predicts that while these households have untapped savings, high interest rates will continue to inhibit spending propensity, meaning their excess savings will go unspent.
Matt Bradley, Event Director for the Retail Technology Show, commented: “The British consumer has shown extraordinary resilience in the face of ongoing pressure on household budgets and unsurprisingly shoppers are prioritising price and value when it comes to retail spending. In such a price sensitive environment retailers and brands are rightly focused on technology and strategies that can deliver cost savings and efficiencies while maximising customer experience to retain loyal shoppers and protect revenue.”
Set to speak on the Headline Stage at RTS 2024, Richard Lim, CEO at Retail Economics, will share insights into the economic outlook for the UK retail industry for 2024 before being joined by speakers from Holland & Barrett and Co-op Food in a session focused on how retailers are responding in such a highly challenging and unpredictable economic environment.
Bringing together the brightest minds in retail with the most transformative technologies, the 2024 Retail Technology Show is a one-stop-shop for innovation, with 400+ innovators – from tech’s biggest players to fast-growth disruptors showcasing their transformative solutions.
To register to attend the Retail Technology Show for free, visit: Retail Technology Show 2024.
