Brits appear to be cutting back on everyday luxuries but are still planning to splash out on holidays this year, according to new research.
A survey of more than 2,000 Brits by audit, tax and consulting firm RSM found 51% now describe themselves as ‘cost- conscious’ buyers when it comes to spending on clothes, homeware, technology, beauty and eating out.
But a quarter of consumers, across all generations, said they had spent more on holidays in the past 12 months, with the same proportion planning to increase their spend on travel and tourism this coming year.
"We’re seeing the rise of the experience economy," said Ian Bell, partner and head of travel and tourism at RSM.
"Whilst our research illustrates the emergence of cost-conscious consumers as the economic squeeze on living standards intensifies, today’s consumers still want to spend big on brag-worthy experiences whilst showing more restraint on everyday necessities."
David Taylor, managing director of Neilson Holidays, added: "The summer holiday remains sacrosanct – they’re effectively ring-fenced, and it is during these holidays that consumers will have the propensity to spend more, come what may. Whereas winter holidays remain more discretionary and vulnerable to the cost-conscious, particularly in times of austerity.
"Life is a lot more pressured than 25 years ago. Our lives are busier. The pressures applied at school and in our jobs are far greater. Holidays have therefore become the beacon for reconnecting with our family and friends and unplugging from our daily lives and distractions. Holidays, and more significantly experiences, have become far more important to us.
"The fast growing experience economy is fuelled by both ends of the demographic scale – by a health-conscious generation Z who have always prioritised active holidays and experiences, and by the more mature who increasingly want to do more than sit on a beach. Consumers across the board are recognising that people switch off better by switching on – it’s a more effective means of distraction from our daily lives."
Bell added: "While travel operators are likely to be the biggest winners in the experience economy, success is not guaranteed. Gathering consumer data, watching trends and tracking shopper behaviours will deliver the information retailers and operators need to stay relevant. The key will be to employ people with the right skills to make sense of it."
