Will Brits still spend when everything goes up?

What's being dubbed 'Awful April' is set to be a month that brings a fresh wave of bill increases, from council tax and water to broadband and mobile costs, along with mounting mortgage and rent pressures. But among this a curious consumer behaviour that may yet persist.  

Despite the squeeze on household finances over the last number of years, many Brits continue to indulge in small luxuries, a phenomenon often coined as 'doom spending'. These everyday treats, though non-essential, offer a sense of comfort and normality in the face of mounting economic strain. 

Recent data indicates that while overall consumer spending has experienced fluctuations, certain categories, particularly small luxuries, have shown remarkable resilience. In February 2025, UK retail sales saw a modest annual increase of 1.1%i, with notable growth in health, beauty, and technology products. This uptick suggests that even with the reality of higher personal tax burdens, increased National Insurance contributions, and rising council tax rates and household bills in many regions, consumers are still willing to invest in personal indulgences. Even if larger expenditures are curtailed.   

This behaviour aligns perfectly with ‘revenge spending’; a term suggesting that following economic downturns, consumers may opt for affordable luxuries to boost morale. For instance, spending on high-end perfumes in the UK jumped by 6.9% YoY in August, while expenditures on less pricey options fell by 2.9%ii, highlighting a preference for premium items that offer a sense of indulgence without significant financial strain. 

Recognising this trend, brands’ marketing strategies can resonate with consumers seeking these small indulgences. One of the most effective tactics is leveraging a Fear of Missing Out (FOMO), creating a sense of urgency and exclusivity.  Look at what happened in late 2024, when a national ‘shortage of Guinness’ in the UK led to increased consumer desire for the stout. There was a shortage, but simply not enough to meet the exceptional demand. The publicity of this scarcity created FOMO, with patrons seeking out establishments that still had Guinness in stock, thereby boosting sales and reinforcing the brand's popularity. ​These strategies leverage consumers' desire not to miss out on exclusive deals, effectively stimulating spending even amidst economic uncertainty.​ 

It's not just high street spending either. Data from October 2024 revealed a 2.7% year-on-year increase in non-essential spending, with entertainment expenditures, such as concert tickets, rising by 14.4%iii. Consumers are prioritising experiences such as this year’s Oasis tour and other small-and-often luxuries to maintain a sense of normality in trying times. 

The persistence of this 'doom spending' underscores the complex interplay between economic conditions and consumer psychology. As individuals navigate the financial uncertainties of ‘Awful April’, the allure of small luxuries might provide comfort and a semblance of control. Brands that effectively tap into this mindset, employing strategies that take this into account, may foster deeper connections with consumers and maintain engagement during turbulent times.