Almost half (42%) of UK consumers have seen disposable incomes shrink by 20 per cent on average in the past year. But the first things to go are not high-priced, one-off items such as holidays, but smaller luxuries including CDs and DVDs as well as trips to the cinema.
This is according to the latest instalment of Avail’s Trust Index survey[1], which found the recession has hit pockets hard in the last 12 months. The effect is a significant change to spending habits, with more than half (59%) of people cutting back on what they spend on fashion as well as nights out (41%).
In contrast, those that are spending are being more careful and switching from the high street to online, with 38 per cent of people now preferring to shop via websites. Nearly a third of those questioned said that they found user reviews and personal recommendations integral to shopping online, while convenience (73%) and value for money (43%) were cited as the main reasons for turning to the Internet.
“While it is clear that consumers are feeling the effects of the recession, they are unwilling to give up their summer holidays just yet,” said Pontus Kristiansson, CEO and founder at Avail. “While they are generally considering purchases more carefully, retailers have a clear window of opportunity to attract new customers on the look out for a better deal than they can get on the high street. The key to success will be providing online shoppers with the most relevant experience to them, personalising each and every journey to maximise sales opportunities.”
[1] The Trust Index survey is based on 250 responses from UK consumers and was carried out during March 2009.
