December spending drops, fashion struggles but increases online - Barclaycard
Consumer spending fell 2.3% year-on-year in December – the biggest drop since June – as areas moving into higher tiers, and reimposed lockdowns, dented the kind of activity usually seen in the festive season.
That’s according to Barclaycard, which sees nearly half of the UK’s credit and debit card transactions. It said that while spending on essential items grew 4.5% year-on-year, department store spending dropped as much as 15.2% and clothing was down 7.3%, ending a bad year for fashion on a decidedly low note. Total in-store spending fell 8.3%.
Overall spending on non-essential items dropped 4.9%, and while it was the biggest decline in six months as mentioned, back in June, the fall had been a massive 22.3% so the December drop was a bit less discouraging.
But online retail increased as much as 52.2% as the usual online shift seen during the Christmas season was exaggerated by consumers being less able (or willing) to visit physical stores. It meant online accounted for almost half (46.8%) of all retail spending in December.
Specialist retailers (which includes toy shops, jewellers and gift shops) and clothing both enjoyed significant growth online, rising 61.9% and 34% respectively.
The continued restrictions across the UK mean that Britons’ confidence in the economy remains low at 22% – almost 20% lower than at the same time last year.
But there’s some cause for optimism about what might happen later in the year. As many as 22% of consumers are already making plans for a big holiday at some point in 2021, which should boost summer fashion, while 24% are feeling more confident about spending on non-essential items than they have been for a long time. Some 40% of them say it’s because they’ve saved more money than normal recently.
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