dentsu: retailers must go beyond discounts as UK shoppers put savings first amid cost-of-living crisis

With the cost-of-living crisis continuing to grip the nation, new research from dentsu reveals that British shoppers are redefining their priorities - and savings have taken centre stage.  

According to its latest Consumer Navigator Report, based on a sample of 4,800 respondents (aged 18-79) across five EMEA markets (n=2,000 UK, n=700 France, n=700 Spain, n=700 Italy and n=700 Poland), value for money (52%) and loyalty schemes (44%) now hold greater sway in retail purchasing decisions compared to other industries, significantly outpacing factors such as customer experience (21%), brand heritage (16%), and brand values (15%). 

The report highlights the seismic impact of ongoing economic struggles on consumer behaviour: 52% of UK shoppers have reduced their spending in the last year, while 80% believe the economy is in a poor state. With 46% of respondents forecasting continued decline over the next 6–12 months, retailers must respond decisively to evolving consumer priorities, dentsu says. 

Essentials like groceries (62%) and basic clothing and footwear (35%) are commanding greater wallet share, while bigger discretionary purchases such as designer clothing (70%), new technology (66%), and household appliances (72%) are being avoided. Amid these cutbacks, brands have a critical opportunity to adapt their approach: 

• Prioritise value for money: Ensure product positioning highlights affordability without compromising quality. 

• Strengthen loyalty schemes: Create compelling rewards programmes that resonate across demographics, especially older shoppers. 

• Refine messaging: Speak to shoppers' need for savings while offering moments of attainable indulgence to preserve engagement. 

Digital channels are reshaping the retail experience as consumers embrace new ways to shop. Dentsu’s research shows that one in five UK shoppers plan to make purchases directly through social media platforms in 2025. Among Gen Z, this trend rises to 37%, as platforms like Instagram and TikTok become hubs for not just inspiration but transactions. 

Websites (45%), applications (28%), and second-hand marketplaces (33%) are also gaining momentum, while two-thirds of shoppers still value traditional in-store experiences. Retailers must capitalise on these insights by: 

• Investing in social commerce: Seamlessly integrate shopping features into social platforms and deliver short-form, engaging content. 

• Enhancing digital convenience: Build intuitive app experiences and streamline online purchase journeys. 

• Connecting channels: Develop omnichannel strategies that bridge the gap between digital interactions and physical stores. 

Retailers looking to succeed must go beyond offering discounts or temporary measures. In an era where shoppers are focused on overcoming financial strain, dentsu’s report emphasises the importance of forward thinking strategies that balance short-term relief  with long-term loyalty. 

Flora Kong, Client Managing Director, at Carat UK&I, a dentsu company, says: “As purse strings tighten, retailers are under immense pressure to deliver meaningful connections and meet shoppers where they are. It’s not enough to simply offer savings - brands need to create value, inspire trust, and build experiences that stand out from the crowd.” 

“Winning over consumers in today’s climate means refining digital tools, developing omnichannel ecosystems, and embedding purpose driven marketing into every interaction. Those who adapt with agility will thrive, while those who fail to keep up risk losing relevance with an evolving consumer landscape.” 

Kenyatte Nelson, Chief Membership and Customer Officer at Co-op, says: “As consumers continue to battle the cost-of-living crisis, the retail industry needs to step up and meet them halfway. We firmly believe in the importance of understanding and responding to the needs of our customers - our recent price match initiative, both in stores and online, was a direct result of this. Dentsu's Consumer Navigator Report provides further evidence that truly listening to the voices of those who shop with us day in, day out will set us apart - in both today’s climate and the future.” 

2025 RTIH INNOVATION AWARDS

Digital channels will be a key focus area at the 2025 RTIH Innovation Awards.

The awards. which will open for entries in April, celebrate global tech innovation in a fast moving omnichannel world.

Our 2024 hall of fame entrants were revealed during an event which took place at RIBA’s 66 Portland Place HQ in Central London on 21st November, and consisted of a drinks reception, three course meal, and awards ceremony presided over by comedian Lucy Porter.

In his welcome speech, Scott Thompson, Founder and Editor, RTIH, said: “The event is now into its sixth year and what a journey it has been. The awards started life as an online only affair during the Covid outbreak, before launching as a small scale in real life event and growing year on year to the point where we’re now selling out this fine, historic venue.”

He added: “Congratulations to all of our finalists. Many submissions did not make it through to the final stage, and getting to this point is no mean feat. Checkout-free stores, automated supply chains, immersive experiences, on-demand delivery, next generation loyalty offerings, inclusive retail, green technology. We’ve got all the cool stuff covered this evening.”

“But just importantly we’ve got lots of great examples of companies taking innovative tech and making it usable in everyday operations - resulting in more efficiency and profitability in all areas.”

Congratulations to our 2024 winners, and a big thank you to our sponsors, judging panel, the legend that is Lucy Porter, and all those who attended November's gathering. 

For further information on the 2025 RTIH Innovation Awards, please fill in the below form and we will get back to you asap.