Almost a third of Britons believe they were financially unprepared for the coronavirus lockdown, a new study has revealed.
Meanwhile, deposits held by British households jumped by an astonishing £25.6 billion in May according to data from the Bank of England, as households held back on spending during lockdown and the financial uncertainty around it.
More caution, bigger savings pots
The study, undertaken by Zopa bank, shows that consumers are now likely to be more cautious about future crises. Almost 40 per cent of people now want to create an extra ‘reserve’ savings pot, and more than two-thirds are expecting a second lockdown.
Millennials – far from their perceived image as careless spendthrifts – are now likely to be the biggest savers. Those aged 24-39 are more than twice as likely to be saving for that rainy day than over-55s are. In fact, the average millennial is now hoping to have an average of more than £21,500 in savings by 2025. That compares with just under £19,000 for those aged over 55 and £20,676 for the nation as a whole.
As for short-term savings, UK consumers are looking to have put away £6,697 by the end of the year, although more than half of those surveyed admit this is because they are financially worse off due to the impact of COVID-19.
How to make the most of it as a retailer
So British consumers are definitely becoming more cautious, but what does this mean for the retail industry? Well, it may not mean simply that British consumers will be spending less, more that they will be more discerning in what they spend – so retailers will have to work even harder to earn their cash.
A fifth of Britons are saving with the expectation of price rises this year and next in flights, holidays and restaurant food, although 16 per cent of consumers are also saving to go on a bigger holiday in 2021, in lieu of missing out this year.
So while consumers are becoming more considered spenders, they also want to be more socially responsible in how they spend. More than 60 per cent are looking to spend more at independent businesses in order to help their financial recovery from the coronavirus crisis.
Likewise, almost a third of restaurant-goers are set to offer bigger tips than before the lockdown, and a quarter intends to give more to charity.
Overall the message is clear: as a retailer if you want to earn the money of your customers, you have to earn their respect too, with ethical and socially responsible behaviours.