A series of trends is shaping new behaviours among consumers in Britain, and this will have a fundamental effect on Q4 retail and advertising trends. As the cost-of-living crisis continues to take its toll and optimism surrounding household finances nosedives, footfall to shopping centres and high streets has fallen, notably declining below 2019 levels. High street footfall is down 3.3% weekly and facing economic uncertainty, this pattern is likely to continue across the winter.

Much of the consumer spend is being rerouted to online, with many consumers foregoing shopping trips for time spent at home. At the same time, the consumer ‘lipstick effect’ – the long-observed phenomenon of increased spending on small luxuries during periods of economic downturn – is setting in. Whilst purse strings tighten on essentials and big-ticket items, discretionary income is spent on smaller luxuries as consumers attempt to self-soothe via the mood boosting power of retail therapy. Whilst a paradise getaway remains strictly off the cards, a small bottle of perfume or luxury chocolate bar serves as a welcome stand in.

Health & Beauty saw growth of 3.8% in October compared to 0.8% last month, whilst the online share of spend for clothing grew to 54.2%, its highest value since March 2022. Consumers, it seems, are seeking out bargains from home, while avoiding the added expense of travel and eating out.

Our own national MSA audience are +45% more likely to say they prefer to buy things online, but over half the UK are now likely to agree with the statement “If I could get all I need delivered from ordering online, I would never go in-store for my shopping”.

These changing consumer behaviours are forming one part of a larger ‘moments economy’ – a concept coined by department store chain, John Lewis, to explain Britons prioritising the enjoyment of day-to-day life moments rather than splurging on larger expenditures. The cost-of-living crisis won’t deter the majority from making the most of everyday moments. More than three quarters (77%) agree that despite the rising cost of living, it is still important to experience moments that make them happy; and two-thirds (67%) say even if their living standards go down, it won’t stop them wanting to celebrate with friends and family. Cassie Holmes, Professor at UCLA’s Anderson School of Management observes: “The pandemic has made all of us more focused on those simple, ordinary moments and seeking to enjoy more happiness from them, because we’ve recognised just how precious our time is.”

As Christmas approaches and colder weather and economic uncertainty makes its mark, consumer spending and leisure patterns will be reappraised. A third of Britons (33%) say they will reduce food expenditure and half (51%) are planning to cut the amount they spend on gifts. 

But that won’t stop the dynamics of how we spend our time this Christmas and across the winter. Visits to friends, family and on our leisure time (shorter staycations) will become even more important. Our current Drive Panel insight from this month shows half of us are planning to take to the roads this Christmas visiting friends and family at any average journey time of two hours. This is part of our journey moments that produce MSA visitor spikes across the year. Before that, weekend leisure spikes will be in place across the month, with the Christmas getaway beginning Monday 19^th December.

The next year will be an important time to adapt to our new behaviours, with the post-pandemic reset affecting consumer behaviour, media and OOH audiences and smarter pivoting by brands to react to economic change.