Fears of further COVID-19 panic buying dampened as supermarket spending remains stable

Fears of panic buying appear unfounded as data from Nationwide Building Society reveals supermarket spending remains stable despite the threat of further local and national lockdowns.

However, supermarket spend across an eight-week period (10 August – 4 October) jumped by 23 per cent year-on-year (£1.5bn vs £1.2bn in 2019) and was around 10 per cent higher than the period of 27 January and 22 March 2020 (£1.5bn vs £1.4bn). This is likely due to a range of factors – from the increased £45 contactless payment limit and higher card usage, to people doing smaller but regular restocks of their cupboards.

The Nationwide debit card data also shows there were no sudden or marked weekly spikes across the period (10 August – 4 October), despite the threat of further lockdown measures. During that same period there was a spending variation of just nine per cent compared to 44 per cent between 27 January and 22 March.

However, towards the end of September, the data points to a greater increase in both the total spend and the average amount spent per transaction (see below table).

Nationwide’s data also shows that the picture across the regions mirrors that seen nationally, with smaller increases in spending now than was seen earlier in the year. London has seen the biggest surge in spending both prior to the national lockdown and as the threat of a local lockdown loomed. Despite some of the tougher restrictions beginning to be implemented across the North, spend only increased by 0.73% between 7 September and 4 October compared to the previous four weeks (see below table).

Mark Nalder, Nationwide’s Head of Payments, said: “It’s clear from our latest spending data that people have adjusted to lockdown measures and how they work, realising that supermarkets will still be open and there isn’t the perceived need to stockpile food, drink and essentials in such quantities. Our analysis shows that while average spend in supermarkets is up overall, and by a reasonable margin, there have not been the same weekly surges in supermarket spend that were seen in the run-up to the national lockdown.

“We’re focussed on delivering convenient, secure and easy-to-use products and services which put our members in control of their money at every step. This has led to growth in digital payments, which have really helped people pay safely and conveniently at an uncertain time.”

Eat Out to Help Out – a short-term gain

Analysis of the Society’s own spending data showed a surge in spend across restaurants and pubs as people looked to take advantage of cheaper meals out available through the Monday-Wednesday government promotion. Spend on Mondays increased by 29 per cent in the four weeks of the scheme compared to the same period prior. A similar increase in spend was also seen on Tuesdays (27%) and Wednesdays (28%). Conversely, although spend in restaurants and pubs at the end of the week and weekend increased, it was a much smaller increase (10% on Friday, 13% on Saturday and 17% on Sunday).

Unsurprisingly, the average daily spend on Monday to Wednesday was at its highest in the final week of the scheme (24-26 August) at £9.53 million. Yet a fortnight later (7-9 September), average daily spend fell by 22 per cent to £7.47 million.

On 31 August (the Bank Holiday), spend was £11.89m across 875,000 transactions.

However, analysis of the 1 September to 27 September period following Eat Out to Help Out shows that Friday (1%) and Saturday (6%) were the only days to see an increase in spend as people potentially moved back to their traditional going out days.

Mark Nalder, Nationwide’s Head of Payments, said: “Eat Out to Help Out was a resounding success while it lasted although as our data shows, once it ended spend across food venues followed suit. While many establishments have continued to offer their own versions of weekday discounts, the pattern of eating out has largely reverted back to the back end of the week, with Friday and Saturday the most popular days.”