71% of Brits Throw Out Impulse Purchases
Every year, British consumers spend £21.7 billion on impulse purchases. More than 50% of consumers make an impulse buy every time they go shopping.
Imagine how much we could save if we cut back on splurging – reports indicate we consume twice as many material goods today as we did 50 years ago!
A Society of Overconsumption
A UK survey by Grant Thornton revealed that nearly 62% of impulse buys are items that consumers ‘wanted, not needed’, with 21% saying they were items they did not need but which ‘might come in handy’.
Participants were also asked whether they had things at home that they’d bought on a whim, which they have or will never use, and were planning to throw out: 71% said they did.
Between 2016 and 2018, prospects for pay growth in the UK are predicted to fall 0.5%, says a report by TUC, and research shows that living standards are already declining as increasing prices outweigh income growth. According to a study done by YouGov for VoucherCodes.co.uk, it’s not just debt that people are in the dark about – more than a quarter of those with a current account has no idea how much is in there.
So, with Brits consuming twice as many goods as they did 50 years ago, with 62% of impulse buys being wants, 71% of impulse buys likely to end up in the trash and salary declines expected for the next two years, who are the consumers blindly spending, and why?
- 18 – 24-year-olds: Group with the loosest hold on finances – 31% are unaware of their bank balance
- London: Region least likely to know bank balance
- East Midlands: Most financially savvy
- 36 years old: The Average age where the attitude to money changes
Over a quarter (28%) of people in the UK with a credit card don’t know how much debt they owe on it, and the same number don’t know the balance of their current account.
With reports stating that we consume twice as many material goods than we did 50 years ago, it’s not surprising that 26% of people admit debt is a part of daily life, with 10.3% believing that purchasing household items is a good reason to go into debt. Consistent spending without thinking about whether there’s a need for the item not only creates clutter but has serious financial implications.
Save Vs. Splurge:
Here’s a breakdown of the most common spends in the UK and a breakdown of how much you could save if you avoid cigarettes, take out coffee, and eating out at restaurants and hotel stays.
With 16.9% of adults smoking an average of 11.3 cigarettes a day in England, here’s what you could save:
Over a month: £ 199.8
Over a year: £ 2,397.6
Over five years: £ 11,988
In 2013, Brits spent £730 million on coffee, with the average male drinking 13 cups, and female drinking 11 cups a week. Some research shows that we even spend more on specialist cappuccinos a year, £608.84, than we do on eating and drinking on holiday – only £359.45. Here’s your spending:
Over a month: £ 50.8
Over a year: £ 608.84
Over five years: £ 3,044.2
Restaurants & Hotels
For the first time in five years, UK households are spending more than £45 a week in restaurants and hotels. Here’s what eating and staying out costs you:
Over a month: £ 180
Over a year: £ 2,160
Over five years: £ 10,800
In total, cutting down on or cutting out all the luxuries above, you could save:
£ 430.6 a month
£ 5,166.44 a year
£ 25,832.2 over 5 years
Think about all you could do with your savings! Every month you could slip away for a weekend to Paris, after five years you could afford a down payment on a house, you could buy a brand-new car, and even settle debts and student loans!
Trends Towards Conscious Consuming
Trends in consumer spending in the UK are showing a more mindful consumer, one that is conscious of the financial, environmental and psychological impact of overspending and over consuming.
It seems shoppers are spending more on experiences than buying products these days. The “experience economy” means that eating out, booking holidays, and discovering new experiences are all drivers in consumer spending. With the consumer moving toward becoming a more experiential spender, there are also trends showing that the UK’s eating habits are shaping an organic inspired movement.
Perhaps we no longer value going to the mall and buying unnecessary stuff that’ll end up piled somewhere at home or in storage. This movement is attracting a global audience who relate to environmental concerns, financial concerns, and the desire for more time and freedom.
Hopefully, we’ll see the experience economy as a driver for a change of culture, creative products, and companies to inspire consumers to be more mindful of spending and save for things that really matter.