A new report has found that while 46% of Brits are shopping less fashion, when they do shop, they are not compromising on the quality of purchases. The 2022 State of Retail Report commissioned by Clearpay in partnership with Oxford Economics, indicates that consumers would opt to ‘trade down’ on food and drink moreover than fashion, demonstrating two key trends; mindful shopping and creative cooking – two of the the ways UK shoppers are perhaps navigating through the current cost of living crisis.
Findings from the new report points to mindful shopping as consumers purchased 68% fewer products in the last 12 months, leaning into a ‘less is more’ approach as they continue to opt for more premium choices as opposed to cheaper alternatives, with sales of luxury products increasing 30% year on year.
The responsible retail choices trend also extends to Brits seeking out sustainable pieces that offer longevity, with new research pointing to 50% of Brits shopping sustainably when possible, particularly amongst Gen Zs, with 59% opting for the greener options. Additionally, Over half (55%) of young British shoppers say that a brand’s sustainability practices are key to maintaining their loyalty, with over 30% of Gen Z even going so far as to abandon brands with a poor reputation for sustainability.
The 2022 report indicates that fashion purchases dominate (46%) as the most frequently identified retail segment where consumers have become more mindful. More than one-in-three savvy shoppers claim they had shopped around more to identify the most cost effective option. However, when it comes to food, 62% of consumers are happy to go for value items as they get creative in the kitchen. With home cooked meals taking precedence over dining out, Brits are investing in their kitchen spaces, with 61% buying the same or more cooking and dining products than in 2019.
Positive impact on small and medium businesses
Conscious consumerism may also be the reason small and medium-sized business (SMB) retailers enjoyed significantly stronger sales growth during the pandemic period. Overall, SMB retailers’ sales growth was nearly three times higher than large retailers between 2019 and 2021 – continuing the recent trend which has seen SMB retailer growth outperform in four of the previous five years, reversing the pattern in the first half of the decade.
Clearpay’s Next Gen Report in February 2022 unearthed that 70% of all spend at the small businesses available on its Shop Directory came from Gen Z and Millennial consumers – increasing by more than 1500% since January 2020. The rise in shoppers flocking to SMBs was likely driven, in part, by a much greater reliance on online channels which accounted for a higher fraction of pre-pandemic revenue.
The State of Retail report also revealed that among those who use BNPL, 58% use the service to manage cash flow, whereas 35% of respondents found the flexibility of the repayment schedule useful.
