Applause Survey Finds 73% of UK Shoppers Plan to Change Festive Spending Habits Due to Inflation and Cost of Living

festive spending habits

·       UK shoppers plan to target Black Friday and Cyber Monday deals as discounts, pricing and returns influence consumer choices this year
·       Most UK shoppers turn to trusted brands as they go without luxury items
·       Buy online and pick up in-store is preferred shopping method, but UK shoppers unsure about AI chatbots

Applause, a provider of testing and digital quality solutions, today announced the 2023 results of its fourth annual global survey on festive shopping trends. The survey found that consumers are exhausted after a year of high inflation with 51% of UK shoppers stating price is the most important consideration when making online purchases. 73% of UK shoppers admitted cost-of-living increases have changed their spending habits, as a result, 24% will target discounts, while another 22% will target Black Friday and Cyber Monday deals.

The global survey of 5500 respondents spanning the Americas, APAC, UK and Europe, took place in October 2023. It featured over 1,200 UK and European respondents that agreed discounts and pricing were crucial to purchasing decisions with just 17% of Europeans saying they intended to pay more for in-store shopping this year than last. Similarly, UK shoppers said they would spend less in-store (30%) and less online (34%) than the previous year.

This year retailers may face pricing pressures as 34% of European shoppers want at least a 30% discount on goods, while 32% of UK shoppers are looking for a minimum 20% discount. Luxury brands such as Armani, Dior and Louis Vuitton are set to miss out this year as 68% of UK and 81% of European respondents say they won’t be shopping for luxury brand items. Crucially for retailers, 65% of UK respondents said a trusted brand is the most important factor when it comes to online shopping this year.

UK shopping and payment preferences revealed

The survey revealed that 64% of UK shoppers are likely to use omnichannel shopping options such as click and collect, curbside pickup or BOPIS (buy online and pick-up in store). 81% of UK respondents said they have previously used BOPIS for their festive shopping, while another 49% stated that when they make online purchases, they prefer to return them in-store. Although retailers should take note, 54% said they would leave a brand after a poor omnichannel experience, including problems returning online orders in-store or collecting refunds. 

Regarding digital shopping options, mobile is clearly the preferred method with 55% of UK shoppers stating they use smartphones or tablets. However, it seems UK shoppers are on the fence when it comes to AI-powered chatbots; 35% believe they add genuine value to shopping experiences, but 33% find them gimmicky. Additionally, 43% of UK and 61% of European shoppers said they never make purchases using a voice-activated smart device such as Amazon Echo or Google Home. When it comes to payments 40% of UK shoppers prefer to use debit cards, followed by credit cards (24%) and mobile wallet services like Apple Pay and Android Pay (21%).

Applause view

“Consumer behaviour is shifting because of inflation and uncertain financial times. Shoppers are looking for deals, doing more research, and considering different, more convenient options to maximize the value of consumer spend,” said Luke Damian, chief growth officer with Applause. “Consumers are looking for lower cost channels and alternatives, and brand loyalty is being eroded by pricing pressure. How retailers respond and deliver seamless shopping experiences will determine the winners and losers this festive season.”

Luke added: “The survey shows that shoppers are motivated to search for discounts and deals. So, it will be critical for retailers to effectively communicate and process discounts and points, especially with their loyal customers. With 27% of respondents saying they will abandon a shopping experience at any point if they encounter a technical bug, closely followed by 25% during the checkout process, delivering flawless digital experiences is a must for brands who want to compete and win over the festive period.”