UK Consumer Spending - June 2024

The colder weather boosts spend on at-home experiences

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The colder weather resulted in a positive month for “insperiences” (i.e. at-home experiences), with overall spend in this category rising by 5.3% in June 2024. Spend on Takeaways and Fast Food increased by 4.4%, returning to positive growth after declining in May 2024 (-0.2%), whilst spend on Digital Content & Subscriptions rose by 9.2%. This was partly due to “streamflation” (the rising price of streaming subscriptions) taking effect, combined with the popularity of new series such as ‘Bridgerton’.

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Meanwhile, Pubs, Bars & Clubs saw modest growth, at 0.5% in June 2024, with the influx of sports fans watching The Euros outweighing the bad weather, and keeping the category on par with its strong performance in June last year.

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However, spend at Restaurants fell by -11.5% year-on-year. Although this was an improvement on May 2024 (-15.7%), this reflects the selective approach cost-conscious consumers are taking to discretionary spending, with 52% of those cutting back on non-essential spending opting to spend less on eating out at restaurants.

Consumers continue to prioritise overseas travel

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Consumers continued to spend on overseas travel in June 2024, with spend at Travel Agents and Airlines rising by 5.5% and 3.2% respectively, whilst spend at domestic Hotels, Resorts and Accommodation declined by -1.8%. This comes as some consumers settled the final costs for their getaways, whilst 37% of consumers also said that when they go on holiday, they tend to spend more than they had planned to, with 20% adopting a “treat yourself” attitude when travelling.

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The Entertainment sector also had a strong month, with spend rising by 6.1%. This was helped by a mid-month boost to cinema spending, as cinemas enjoyed their busiest day of the year so far on 15th June, with spend up 122.4% in comparison to the average day in 2024, after the release of ‘Inside Out 2’.

The weather continues to dampen Retail sales

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The cold in early June 2024, in contrast to 2023’s sunshine and warm weather, resulted in overall Retail spending falling by -2.6% in June 2024. This is the lowest year-on-year growth since June 2022 (-3.8%), as high-street cutbacks led to in-store spending (excluding groceries) and clothing sales declining by -5.1% and -7.7% respectively.

 

This comes as 39% of consumers say that they have spent less than usual on summer products this year, due to the weather, with clothes (55%) emerging as the main area consumers have cut back on, followed by barbecue equipment and food (40%). **

 

Consumers have also been put off home and garden renovations due to the cold snap, with spend on Home Improvements & DIY declining by -9.4% in June 2024, whilst spend at Garden Centres saw a steeper drop of -12.7%. However, Pharmacy, Health & Beauty stores had another positive month, with spend rising by 5.8%. This is due to several factors including the “lipstick effect”, a growing interest in personal wellness, and the influence of viral makeup and skincare videos.

Consumers continue to cut back on grocery expenditure

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Spend growth at Supermarkets fell by -2.6% in June 2024, the lowest year-on-year growth since April 2022 (-4.5%). This slowdown is partly attributed to the particularly high food price inflation seen in June 2023 (14.6%), which has now fallen to its lowest point since October 2021 (1.7%). Encouragingly, 36% of shoppers say that they have noticed that food prices have been rising at a slower rate in recent months.

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Nonetheless, the majority of consumers (65%) say they are continuing to cut back on their weekly grocery expenditure, with 52% of these budget-conscious shoppers looking out for loyalty scheme discounts and supermarket deals.