Barclays: Online Spending Grew 5.7% in January

• Clothing (3.1 per cent), health & beauty (8.0 per cent) and marketplaces (4.8 per cent) all performed strongly
• ‘Premiumisation’ of cupboard staples emerges as 72 per cent opt to pay more for branded goods, and specialist food and drink retailers grow 4.5 per cent
• Entertainment reached a six month-high and streaming was up 9.3 per cent amid the popularity of Heated Rivalry and Stranger Things
• Consumer confidence held steady, with sentiment towards household finances at 66 per cent and the ability to live within one’s means at 71 per cent
• The Barclays Consumer Spend report combines hundreds of millions of customer transactions with consumer research to provide an in-depth view of UK spending 

Consumer card spending increased 0.8 per cent in January – considerably less than the latest CPIH inflation rate of 3.6 per cent. Essential spend fell -1.1 per cent, marking six months of decline, but discretionary spending grew 1.6 per cent, led by the strong performance of online retail over the January sales period. Entertainment was another bright spot, boosted by the cold weather, awards season excitement and the runaway success of new TV shows such as Heated Rivalry. 

Consumer confidence remained stable in January, with most measures on par with December, when they improved marginally. Confidence in household finances remained at 66 per cent, up two percentage points from November (64 per cent), while confidence in consumers’ ability to live within their means also stayed flat, at 71 per cent. 

Retail recovers after subdued ‘Golden Quarter’

Retail rose 1.7 per cent in January, after sales were flat in December (0.2 per cent). Clothing (3.1 per cent), pharmacy, health & beauty (8.0 per cent) and general retailers & marketplaces (4.8 per cent) all enjoyed strong performances (up from 1.1 per cent, 4.3 per cent and 2.6 per cent in December). Online retail spend growth (excluding groceries) reached 5.7 per cent, with online’s share of retail spending (excluding groceries) at 59.2 per cent – its highest level since January 2022 – suggesting shoppers browsed the sales from the comfort of home. 

Screentime soars

Spending on digital content & subscriptions grew 9.3 per cent year-on-year, as viewers tuned in to watch popular series such as Heated Rivalry and Stranger Things. Over a third (35 per cent) said they watched more films and TV shows in January due to the cold weather and dark evenings, which also contributed to a six-month high for entertainment, up 8.3 per cent, as cinemagoers ventured out to see Oscar-nominated films including Hamnet and Marty Supreme. 

‘Premiumisation’ of cupboard staples and branded favourites

Three in five (59 per cent) are looking for ways to cut the cost of their weekly shop, however seven in 10 (72 per cent) say they’re willing to pay more for specific branded products, despite there being cheaper, own-brand alternatives available. People are most inclined to pay extra for branded tea and coffee (35 per cent), condiments such as ketchup and mayonnaise (27 per cent), laundry products (25 per cent), and butter and spreads (24 per cent). 

Similarly 19 per cent say they’ve been buying more “premium” produce and 17 per cent are happy to pay more for foods that benefit their long-term health. This comes as spending at food and drink specialist stores grew 4.5 per cent in January. Half (50 per cent) of those cutting discretionary spending (51 per cent) say they will spend less on takeaways, with the category down -0.3 per cent year-on-year – its greatest decline since June 2025 (-1.1 per cent). Restaurants saw growth of 1.7 per cent, but transaction volumes for overall eating and drinking dropped -1.6 per cent, suggesting consumers prioritised home cooking in January.

GLP-1 friendly foods hit the shelves

Amid the growing popularity of weight loss drugs, one fifth (17 per cent) of consumers have spotted more GLP-1-friendly options on supermarket shelves, rising to 28 per cent for those aged 18-34. A further 15 per cent have also noticed these options on offer on restaurant menus and when eating out. 

The new year has also brought a renewed focus on health and wellbeing for half (50 per cent) of UK adults. Topping the list of health-focused habits is: eating fewer ultra-processed foods (29 per cent), eating more fibre (20 per cent) and protein (19 per cent), and buying products that support gut health (12 per cent). 

Karen Johnson, Head of Retail at Barclays, said: “Both big and small screen entertainment thrived last month, helped by the buzz around awards season favourites, and people spending more time at home. This also resulted in growth for online retail, as shoppers seemingly held out for the January sales. Specialist foods stores, in particular, saw a boost, with premiumisation of pantry staples boosting sales, particularly those supporting health goals, even when sticking to a budget.” 

Jack Meaning, Chief UK Economist at Barclays said: “Improving consumer confidence is absolutely key to the UK’s economic outlook in 2026. With that in mind, the stabilisation in this month’s survey is an encouraging step in the right direction. With inflation set to fall quickly in the coming months, interest rates on course to ease and some early signs of resilience in wider activity, the scene is set for confidence to pick up, supporting growth in spending as the year goes on.”

Overall growth figures 

Source : Barclays

Image : shutterstock / William Potter / 1024344034

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