UK consumers view beauty, entertainment and travel as “non-negotiables”, even as household budgets remain tight and shoppers become more budget-conscious as a result.

Barclay’s ’10 Years of Spend’ report, analyses a decade worth of insights, tracking consumer and economic confidence alongside proprietary transaction data. The data shows UK consumers have become savvier at combating rising costs while maintaining the quality of life they value.

66% of shoppers pay more attention to their budget than they did a decade ago with 82% saying they are concerned about shrinkflation, amid increasing awareness of pricing. However, between 2021 and 2024, discretionary spending grew at an average annual rate of 9%, significantly outpacing the 5% growth in essential spending.

“Ten years’ worth of analysis tells us that while confidence in the UK economy has declined, UK households’ confidence in their ability to manage their money has remained strong, translating into the impressive performance of categories such as travel, entertainment and beauty.”

Karen Johnson, Head of Retail, Barclays

Even when making cutbacks, consumers are finding room in their budgets to spend on they things they love with a quarter of shoppers (24%) saying they prioritise enjoyment and creating memories – finding value in experiences over material goods.

“Amid all the highs and lows – from rising bills, job insecurity and a fluctuating global and national economy. It is encouraging to see that through purposeful spending, consumers continue to prioritise the things that bring them joy, unlocking the potential for UK economic growth,” added Johnson.

Entertainment and travel have both outperformed retail subcategories in recent years, with the exception of beauty, which has continued to go from strength-to strength.

Tracking ecommerce revenue growth year-on-year for May 2025, IMRG reported the strongest performing categories included fragrance and health and beauty.

“Year-to-date fragrance is up 31%. It was also the strongest category in 2024 so this represents a continuation,” commented Andy Mulcahy, Strategy and Insights Director at IMRG.

The report also shows consumer spending on digital content and subscriptions has increased by nearly half (48%) since January 2020. 88% are signed up to at least one subscription – with monthly spend on content services averaging £50.