The unlocking of the economy after the winter lockdown has led to the fastest-ever quarterly growth in in-store and online shopping, according to the latest insight into consumer spending behavior.
The British Retail Consortium – the trade body which represents retailers – said warmer weather, people on holiday in the UK and the start of the Euro 2020 football tournament had all reinforced the upward trend in spending.
In its monthly health check conducted in conjunction with accounting firm KPMG, the BRC said retail sales were 13.1% higher in June than in the same month two years ago, while the total for the second quarter of 2021 was 10.4% up on the same three-month period of 2019.
The BRC said it was comparing 2021 spending to 2019 as last year’s figures were skewed by the slowdown caused by the early stages of the pandemic.
Separate figures from credit card company Barclaycard provided evidence to support an increase in consumer spending in June, with activity 11.1% higher than in the same month of 2019. Barclaycard said as spending on fuel, hotels, resorts and accommodation all rose for the first time since the pandemic began, as holidaymakers booked and embarked on UK breaks, while the collective enjoyment of sporting events was a factor behind a 38.1% increase in spending on bars and pubs.
The BRC said post-lockdown consumer freedom to shop in the high street and retail parks had led to lower online spending, with digital penetration falling from 49.7 per cent to 39.3 per cent between June 2020 and June 2021.
Official retail sales figures from the Office for National Statistics – which do not include spending on bars, restaurants and hotels – showed a fall of 1.4% between April and May. The June figures will be released next week.
Helen Dickinson, chief executive of the BRC, said: “The second quarter of 2021 saw exceptional growth, as the gradual unlocking of the UK economy encouraged a release of pent-up demand built up during previous lockdowns.
“In June, as food sales growth began to slow, non-food sales were supported by growing consumer confidence and the continued outburst of consumer demand. With many people taking cheaper breaks or holidays to the UK, many found they had a little more to spend in the shops, with strong growth in store in June. Fashion and footwear did well as the sun shone through the first half of June, while the start of Euro 2020 gave TVs, snacks and beer a boost.
Dickinson warned retail was still struggling, with many businesses still trying to make up for lost ground during the lockdown and town centers still suffering from low footfall caused by working from home and a lack of international tourists .
“Consumer comfort with the next stage of the roadmap will be key to continued retail success. Many customers are eagerly awaiting a return to a more normal shopping experience, while others may be discouraged by the change in face covering rules. The government will need to reassure the public about safety, while continuing its hugely successful vaccination program. »
Paul Martin, UK head of retail at KPMG, said: “The fight for share of wallet is on as consumers unleash pent-up demand for social activities as restrictions in the UK continue to tighten. loosen.”
Raheel Ahmed, Head of Consumer Products at Barclaycard, said: “June saw Britons flock to pubs, bars and beer halls to watch football and tennis on the big screen, as the heat wave earlier in the month encouraged many of us to get out in the sun and socialize.
“The start of the Olympics and the planned easing of restrictions later this month should continue to lift spirits and provide more opportunities to get together, whether it’s a weekend, a meal out or for celebrate sporting victories.”
