It’s been a year unlike any other, and not being able to go out to the pub, the shops or the cinema has — along with many other things — had a big impact on where and how our customers spent and saved money.
To see exactly what effect the Covid-19 pandemic and the local and national lockdowns in the UK have had on our financial habits, we’ve looked back over our pre-pandemic customer transactions from March 2019—February 2020 and compared them with our lockdown spendings of March 2020—February 2021.
Despite being stuck at home, we discovered that, on average, each person has spent 16% more in the last 12 months than in the previous year, with spending increasing in a few key areas.
Shopping online skyrocketed
Across the nation, non-essential shops were closed for a large part of the year, meaning that many high streets were nearly deserted and shopping centres shut their doors too. The effect of this was a massive surge in online shopping, particularly in November and December 2020, with Black Friday and Cyber Monday driving even more people online. Looking at all transactions made by Monese customers over the last 12 months, a staggering 80% more money was spent at online retailers versus the year before.
This figure includes online grocery shopping, which grew in popularity as many people sought to avoid supermarket trips and long queues. Some supermarkets reported that, particularly at the start of each new lockdown, their delivery slots had sold out completely, although this pressure eased as lockdowns progressed.
One of the more recent challenges and expenses that has come with online shopping has been the arrival of EU-UK shopping taxes after Brexit. Some buyers were caught out by unexpected customs tariffs, handling charges and VAT costs.
DIY spending surged
We calculated that on average our customers spent 184% more on DIY tools and products in the last year, showing just how popular painting, decorating and home renovating was. Interestingly, the weeks our customers spent the most on DIY kit and caboodle was 22 November, followed by 16 August — not during the first national lockdown as may have been expected.
In the first national lockdown, hardware stores were forced to close as DIY products were not deemed to be ‘essential items’. When the government allowed these to reopen from 23 April 2020, business boomed, with reports of long queues at DIY chains across the nation.
While buying things for your home can be expensive, some projects are reported to add value to your property too, so it’s an investment that can pay off in the long term. Some people also find decorating and DIY relaxing, fulfilling and a welcome distraction from some of the worries of last year.
Supermarket spending shot up
Another area where our customers spent a lot more money was at the supermarket — perhaps not surprising that while we couldn’t go out for dinner or to the pub, we bought more groceries for meals at home. On average, we estimate that households spent 51% more at the supermarket in the last 12 months.
The peak week for supermarket spending in the last 12 months was just before Christmas (20 December) which was also the biggest week in 2019.
However, the biggest annual increase took place just before the first national lockdown, during the week of 15 March 2020 when 47% more was spent at the supermarket than during the same week in 2019. This date ties in with reports of stockpiling and panic buying, with many households dashing to supermarkets to buy dried and canned foods, and endless amounts of toilet roll.
Fortunately, things settled down a bit by the end of March and, while spending was still higher during the remainder of the year, we didn’t see any similar surges as in that first, worrying week in spring.
Utilities bills went through the roof
With more people working from home than ever before, the nation’s utilities bills also soared. We estimate that the total cost of water, electricity and gas bills grew by 69% in the last 12 months. The cost started to jump up around 26 April — one month after we started working from home — and stayed at this higher level for the rest of the year.
Another potential reason the nation’s electricity bills went through the roof last year could be because Britain went mad for hot tubs. Many retailers said they’d sold out by the summer. If you fancy joining in on the trend, it’s worth noting that they come with a potential annual running cost of £600 per year!
Other places we spent more money
A few of the other areas our customers spent more money last year are at:
- digital games stores (+168%)
- car washes (142%)
- pet shops (+113%)
- motorcycle dealers (+101%)
- jewellery and watch retailers (+98%)
- musical instrument shops (+71%)
- TV streaming services (+68%)
- craft shops (+46%)
- toy shops (+40%)
- second-hand shops (+40%)
- pharmacies (+31%)
A lot of us got a new pet during the lockdowns, with many explaining that their ‘pandemic puppy’ has helped them get through this challenging time. A year on, some animal shelters are sadly reporting that they’re getting a lot of pets handed over because their owners aren’t able to look after them.
Getting a pet, particularly a dog, can be very expensive — as much as £33,000 throughout their lifetime — so it’s really worth thinking about if you can afford that sort of financial commitment before you buy your furry friend. After all, a dog is for life, not just for lockdown.
Places we spent less money
At the other end of the scale, there were, of course, many areas where our customers spent a lot less money in the last year. Perhaps not surprisingly, customers spent 81% less at cinemas; 66% less at theatres; and 56% less at bars, night clubs and pubs.
Our customers also spent 26% less at restaurants in the last 12 months. However, the Eat Out to Help Out scheme certainly gave the hospitality sector a boost, and our average restaurant bill (per visit) went from £47.70 to £59.16 in August 2020.
Monese customers also spent a lot less on travel: 49% less on train tickets, 32% less on airline tickets, 27% less on car rental, and 23% less on bus tickets too.
Savers also squirreled away more money for rainy days
While many people were spending more money during lockdown, we were pleased to see that others have been able to set aside more savings for the future too. It’s great to have a safety net if you can.
On average, Monese customers that use our saving pots feature put aside in excess of three times more in the ‘year in lockdown’ versus the previous year. The average Monese saver also doubled the value of their pot!
We ran a survey earlier in the year to find out what people were saving for and discovered that over a third were setting money aside for a rainy day (37%), one in four were looking to hit a specific savings milestone (26%) and a similar number were putting cash aside for a holiday (25%) in the coming months.
If you live with a partner, it can be easier to hit a specific savings goal if you’re both invested in doing so. But we know that talking about money with our nearest and dearest can be a challenge, so we wrote up a blog about how to tackle those tricky conversations about money, as well as how to set a joint budget and savings goals. A joint account is a great place to start and can be set up in minutes!
Looking to the year ahead
With the lockdown easing roadmap now revealed, many of us are looking forward to getting back to ‘normal’: visiting loved ones, organising holidays, heading out on shopping trips and, of course, getting a round of drinks in for colleagues after a long working week. If you’re worried about money and the resumed cost of commuting and socialising, then it’s important to plan ahead as best you can.
We analysed Monese card transaction data comparing consumer spending data for March 2019 to February 2020, with data for March 2020 to February 2021. We compared spending between these two time periods across a number of categories and analysed this on a week-by-week basis. This allowed us to rank consumer spending categories as well as amount spent and rate of consumer spending throughout the past year. Monese has over one million customers in the UK.