As the cost of living crisis builds up UK shoppers are slashing their budgets in almost all areas. But there is a notable exception – the money spent on clothing is above pre-pandemic levels, the return of weddings, holidays and socialising fuelling a boom in “revenge spending” or buying those treats missed over months of pandemic lockdowns.
Shoppers are forking out almost a fifth more on clothing than last year, according to research from data analysis company Kantar, taking the value 1% ahead of the 2019 figure.
The resilience of the demand for fashion, footwear and beauty products is defying expectations of a slowdown in non-essential spending, despite the squeeze on spare cash from rising energy bills, and food and transport costs.
Footwear was the fastest growing non-food category last month, according to British Retail Consortium data out this week, with clothing at number three behind health and beauty. By contrast, sales of almost all other non-food items fell, including those of toys, technology and homewares.
“People are valuing that bit of escapism,” said Andy Saxton, fashion insight director at Kantar. He suggested money was being saved on workwear, where spending was down by almost a quarter on pre-pandemic levels, and going instead on items with more flexible use, from T-shirts to dresses, that could be worn for social occasions and as more relaxed office attire.
The reopening of high streets, which has made it possible to try on more fitted clothes, such as jeans and bras, and to make shopping a more social occasion, has led to soaring sales for the UK market leader Primark, which had no online shop during the lockdowns. Sales jumped 81% over the 12 weeks to 28 May and were 4% up on 2019 levels.
Marks & Spencer, the Spanish-owned chain Mango, and the online specialists Boohoo and Asos, have seen customer spending continue to climb.
“Fashion is still basking in the online boom and revenge spending,” said Kayla Marci, a market analyst at the fashion research and advisory group Edited, referring to the industry’s term for when people spend more after a negative event.
Part of the reason till receipts are back to pre-pandemic levels is due to everything costing more. Kantar found the volume of clothing items being sold had fallen by about 8%, while the average price being paid for items was up by 9%.
However, Saxton said the higher spending was not just due to inflation, but also to shoppers choosing better brands. “People are making more considered purchases. Impulsivity is going down. People want more control over where their money goes and it has to go further.”
He said shoppers were looking for fashion that was “ going to last a bit longer” and which they would not have to replace “in the next few months”.
That chimed with research that the John Lewis chain conducted in May in which 37% of shoppers polled said they were looking for versatile clothing to make their money go further. The department store said it had not noticed a recent downturn in sales in any fashion category. Clothes for socialising were proving particularly popular, with 55% of respondents saying they intended to invest in them.
“We’ve not only seen sales increase for entry-level price points, but also higher-end products that customers know they’ll be able to use again and again,” said Beth Pettet, a buyer for John Lewis.
According to Kantar the overall market is also being held up by strong sales of essentials, such as underwear, nightwear and socks, with spending in those areas up 10% on pre-pandemic levels. Again, that is partly because of higher prices. The cost of cotton has been volatile and underwear prices have been among the biggest risers at 21% more than in pre-pandemic years, according to Edited.
Demand for sportswear has also remained strong, with lifestyle changes made during the pandemic continuing. Spending is 3% ahead of that in 2019. Sales of trainers are up by a fifth, as casual footwear increasingly becomes the norm, but smart footwear sales are in decline.
Purchases of outfits for weddings and parties are also surging, with spending now 1% ahead of pre-pandemic levels and 165% up on last year, according to Saxton. “A lot of people are looking through their wardrobe and realising the last time they wore an outfit was more than two years ago and they need a wardrobe refresh.”
Spending on holiday gear is more than triple that of last year but remains almost a fifth below pre-pandemic levels, Kantar found.
Pippa Stephens, from the research group Global Data, said a shift to more casual dressing in the workplace was likely to mute trading for suit and shirt makers. She suggested supermarkets, and shops such as Primark and possibly Marks & Spencer, were likely to benefit from the focus on essentials.
Younger shoppers have been found to be cutting back far more on their spending, according to Stephens, a change that would be affecting more fashion-forward retailers and online specialists.
“Most are on lower incomes or have young families to look after. Older shoppers’ incomes are less affected and they focus on more classic items that they are less likely to cut back on,” she said.
However, the state of clothing sales across the retail market is expected to get much tougher in the months ahead.
Saxton suggested the autumn and winter fashion season would probably face difficulties as inflation continued to squeeze spending power in the UK and supplies of clothing were hit by difficulties with production in China and other countries where Covid lockdowns have led to factory closures and delays at ports.
Natalie Berg, a retail analyst, said “the worst was yet to come” in terms of consumers cutting back on fashion spending. This would be “especially in October, when we have to turn our heating back on and the prospect of even higher energy bills hits us”. She said: “That is keeping retailers up at night.”
