New customer data shows holiday spend take off during spring
A damp and dull start to 2024 has impacted consumer spending habits, according to the latest Virgin Money current account lifestyle spending data.1
The new data reveals spring lifestyle spending (covering the period between March and May this year) rose to £722.9m, an increase of £18.2m compared to the same period last year and by £55.2m compared to winter (December 2023-February 2024) – an increase of 8%. The number of transactions similarly rose by 8% compared to winter, totalling 29 million, with the value of spending and frequency of purchases higher as consumers look ahead to their summer plans and budgets. Lifestyle categories include holidays, UK stays, eating out, style, wellbeing, keeping fit, memberships and subscriptions and entertainment.
Holiday spend takes the top spot
With news that the UK has endured the wettest 18 months since records began in 18362, and reported forecasts bracing consumers for an equally soggy summer3, holidays were top of the list for Virgin Money customers. Holiday spend, which totals £142.9m for the quarter, increased by an impressive 34% in spring compared to winter (an increase of £36.2m), with the number of transactions rising by 31%. Reflecting the ongoing pent-up demand for travel, total spend and transactions for holidays are up year on year – by 9% (£12.3m) and 14%, respectively.
The data shows clear differences in holiday spending trends, based on the age demographic of Virgin Money customers. The 56- to 65-year-old group have spent the most on flights and holiday bookings via travel agents (£10m and £26.3m respectively), while the over 65s are the biggest spenders on cruises, forking out a total of £1.9m, compared to 18- to 25-year-olds who spent just £107k on cruises. In terms of retailers, Jet2holidays, TUI and Virgin Atlantic were prominent across all age groups, with Hays Travel also making it into the top three brands for the over 65s and loveholidays coming in third for the 26- to 35-year-olds.
However, with summer on the horizon, not everyone is planning on jetting away. Spend on staying away in the UK is up by £6.9m in spring vs winter, totalling £48.3m. This is a quarterly increase of 16.6%, and the number of transactions has also risen by 17%.
Spring bank holidays encourage spend on eating out
In other categories, spend on eating out, which includes takeaways, restaurants, cafes, pubs, bakeries, fast food restaurants, coffee shops and food/drink purchased at concerts, has increased by £21.5m to a total of £285.6m (up 8% compared to winter and 4% year on year) – the highest total of all the lifestyle categories. The number of transactions also rose by 10%. All age groups have spent more on eating out in spring compared to winter, but it’s 56–65-year-olds who are the biggest spenders here, making £5.8m worth of transactions in this category during spring. They are closely followed by the over 65s, who totalled £5.6m, which is an increase of 14% on their winter spend on eating out.
Spend on style drops but sustainability appeals
Spend on style has seen the biggest drop across the lifestyle categories both from an annual point of view, as well as quarterly, dropping by £8.5m since winter (a 7.2% decrease), and down by £4.9m year on year. Customers aged between 46 and 55 years old have cut their spend on style by £3.1m, while the 36- to 45-year-olds have cut back by £2.2m.
This suggests that, with the festive fun of Christmas and New Year’s Eve a distant memory, consumers are perhaps cutting back on their spend on things such as fashion in order to balance their budgets and instead spend money on experiences with friends and family, such as holidays in the UK and abroad and eating out.
Reflecting a more frugal attitude to style, a positive trend has emerged around sustainable ways of shopping, with customers embracing pre-loved fashion. Virgin Money customers spent a total of £5.2m at Vinted, an online marketplace for selling, buying and exchanging secondhand clothes, shoes and accessories from various brands, which is an increase of £1.7m on this platform compared to spring 2023. Volume of transactions and spend at Vinted is on the up across all age groups year on year, with 46- to 55-year-olds spending the most at Vinted, followed by 36- to-45-year-olds and then 26- to-35-year-olds. The growing trend is supported by a recent study which found UK consumers spent £2.4bn on secondhand clothes in 20234.
Graeme Sands, head of personal banking at Virgin Money, said: “With lifestyle spending this spring up overall compared to winter, our customers are opting for shared experiences with friends and family over material goods, particularly holidays, prompted by recent unpredictable weather, and eating out. The declining spend on style this quarter is also coupled with a move towards sustainable fashion retailers, reflecting a conscientious consumer trend.
“At Virgin Money, we continue to provide our customers with the tools and products to help them manage their money in a way that works for them, whether that’s support with balancing their budgets so they can enjoy little treats, or help with saving for a once in a lifetime holiday.”
The Virgin Money mobile banking app is packed full of clever tools to help customers budget, top up savings and track their transactions to help people feel in control of their money. Virgin Money also offers a wide range of savings products to help customers make their money work for them.
To find out more about Virgin Money’s product and services, visit: www.virginmoney.com
About the research
1 Customer spend data sourced from Virgin Money current account customers who have actively spent in one or more of the lifestyle categories between 1 March 2024 and 31 May 2024. Lifestyle categories include eating out, holidays, style, wellbeing, entertainment, keeping fit, staying away, and memberships and subscriptions.
Source
2 FT news story on England’s wet weather: England drenched after the wettest 18 months since records began in 1836
3 Evening Standard news story on Brits bracing for soggy summer: Britain braced for soggy summer as Met Office 'warns Government 50 days of rain is possible' | Evening Standard
4 MSN news story on the survey carried out via Opinium for Westfield, as part of this year’s Westfield Good Festival: Consumer spending on secondhand clothes and shoes hit £2.4bn in 2023 – study (msn.com)