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Consumer Profile

Consumer Profile
Like many Western countries, the United Kingdom has an aging population. The median age is 40.4 (ONS, 2020), compared to 39.5 in 2010. According to the latest World Bank data, people under 14 represent 18% of the population while people over 65 represent 19% of the total. The population growth rate is 0.4% (ONS, 2020). On average, there are 2.4 people per household. According to the Office for National Statistics, the number of households remained stable compared to the previous year, reaching 27.8 million in 2020, an increase of 5.9% over the last 10 years. The number of people living alone has increased by 4% over the last 10 years, driven mainly by increases in men aged 45 to 64 years living alone. Regarding the ratio of men to women, women represent 50.6% of the total population (World Bank, 2020). Around 84% of the population lives in urban areas for 2020 (World Bank). London and its surroundings are high density areas, and there are other densely populated areas in the centre such as around Manchester and Liverpool, but also around Edinburgh and Glasgow as well as in southern Wales, around Cardiff, and east of Northern Ireland. The main cities are London, Birmingham, Liverpool, Nottingham and Sheffield. In the United Kingdom, 82% of adults aged 25-64 have completed upper secondary education, higher than the OECD average of 79%. This is slightly truer of women than men, as 83% of women have successfully completed high-school compared with 81% of men. In terms of employment, 75% of people aged 15 to 64 in the United Kingdom have a paid job, above the OECD employment average of 66%. Some 86.6% of the active population is employed while 13% are entrepreneurs and self-employed (ONS, 2022). The sectors employing the most manpower are wholesale and retail sales (13.64%), health and social services (12.96%), scientific and technical occupations (9.17%), support and service (8.91%), education (8.46%), manufacturing (7.21%), hotels and restaurants (6.87%) and construction (6.31%) (ONS, 2021).
Purchasing Power
The GDP per capita PPP is approximately USD 46,483 (World Bank, 2020). People in the United Kingdom earn USD 47,147 per year on average, slightly less than the OECD average of USD 49,165. In the United Kingdom, the average household net adjusted disposable income per capita is USD 33,049 a year, higher than the OECD average of USD 30,490. UK households reduced their spending during the pandemic by an average of £109.10 (or 19%) a week, and around a third of workers saw their income fall in the financial year 2020/2021 (ONS). Many consumers have delayed purchases as a result of the crisis, adopting new habits to save money and becoming more mindful of how they spend. Income inequality, as measured using the Gini coefficient, has been broadly stable over the past ten years, the indicator reaching 34.4% in 2021 (Statista). The income of the richest 20% of people was over six times higher than the poorest 20% in 2020, and the gap further increased in 2021. According to the Office for National Statistics, the gender pay gap among all employees was 15.4% in 2021, up from 14.9% in 2020 (but down from 17.4% in 2019, before the pandemic). There was nonetheless a fall in the gender pay gap within the managers, directors and senior officials occupation group in 2021.
Consumer Behaviour
The United Kingdom is a mass consumer society, even though ecological and responsible consumption is growing. The main factors influencing purchase are price, quality, design, brand or environmental benefits. After-sales service should also be considered and claims are common. The British are increasingly buying online, thus online commerce is an important market. Regarding the choice of product origins, 6 British out of 10 say that UK origin is as important as price. Brand loyalty will often depend on price.

Virtually all adults aged 16 to 44 years in the UK were recent internet users (99%) in 2021. Social networks are also important in the purchase decision. The number of social media users is equivalent to 84.3% of the total population and Facebook is the main network (Data Reportal). Facebook and Instagram influence the choice of travel destinations. Influence is stronger for those under 24 and over 55. According to Deloitte research, the proportion of UK consumers very worried about the amount of personal data shared online, the usage and their rights halved in two years, from 47% in 2018 to 24% in 2020.

COVID-19 pandemic has affected consumer behavior: more than 60% of UK consumers have changed stores, brands or the way they shop; up to 50% consumers have decrease spending on most discretionary categories. More of the United Kingdom consumers are shifting to online purchases and services, and many intend to continue after COVID-19 subsides.

Ethical and environmental business practices are becoming increasingly important. Sales of organic products have increased in the last years. According to figures from Soil Association, organic product sales grew by 5.2% in 2021. Purchases of organic products are generally made in independent stores or delivered at home. Respect for the environment also encourages the circular economy and the second-hand market. According to Ibis World, the market size of the second-hand goods stores industry in the UK has declined 3.3% per year on average between 2017 and 2022, but is expected to increase 24% in 2022.
 

Household Consumption Expenditure

Sector Percentage
Housing, water, electricity, gas and other fuels 26.0%
Transport 13.0%
Various goods and services 12.0%
Culture and leisure 9.0%
Restaurants and leisure 9.0%
Food and non-alcoholic beverages 8.0%
Clothing and shoes 5.0%
Furnishings, household equipment, everyday maintenance of the house 5.0%
Alcoholic beverages, tobacco and narcotics 3.0%
Communication 1.0%
Health 1.0%
Education 1.0%

Source: OECD Stats, 2017.

Consumer Recourse to Credit
In the United Kingdom, payment cards are widely used. Of the 164 million transactions in 2016, 100 million were made with debit cards, 59 with credit cards and 5 with private cards. Household debt stands at 86.35% of GDP, a relatively high level in Europe and rising. The outstanding debt to households is 428 billion pounds in 2018. The average debt per capita is 37,000 pounds, and 61% of the inhabitants have a debt. Consumer credit is rising in the UK, but is slowing. They mainly finance vehicles, education costs and durable goods. Consumer credit is expected to continue to grow at a slow pace.
Growing Sectors
Home and garden equipment, appliances, hobbies, culture, personal care, vehicles, drugs, audio-visual equipment, alcoholic and non-alcoholic beverages, food services, shoes, clothing, food, dishes and household utensils and telephony.
Consumers Associations
Citizens advice , Several causes including consumer protection
Which? , Consumer Association
Ambudsman Association , Consumer resolution
 

Population in Figures

Total Population:
67,215,293
Urban Population:
83.9%
Rural Population:
16.1%
Density of Population:
278 Inhab./km²
Men (in %)
49.3%
Women (in %)
50.6%
Natural increase:
0.57%
Medium Age:
39.0
Ethnic Origins:
European origin (about 87%), African origin (about 3%), Indian (about 3%), Pakistani (about 2%), mixed (about 2%) and other origin (about 3%). (Office of National Statistics)
 

Population of main metropolitan areas

City Population
London 9,047,600
Birmingham 1,160,300
Glasgow 630,000
Liverpool 586,900
Bristol 577,300
Manchester 563,600
Sheffield 552,200
Leeds 511,200
Edinburgh 504,100
Leicester 472,600

Source: Citypopulation.de, Latest available data - Latest available data.

 

Age of the Population

Life Expectancy in Years
Men:
79.4
Women:
83.1

Source: United Nations, Population division, World Population Prospects., 2009 - Latest available data.

 
Distribution of the Population By Age Bracket in %
Under 5:
6.0%
6 to 14:
11.4%
16 to 24:
13.2%
25 to 69:
57.6%
Over 70:
11.8%
Over 80:
4.7%

Source: United Nations, Department of Economic and Social Affairs, Population Division. - Latest available data.

 

Household Composition

Average Age of the Head of the Household 51.0 Years
Total Number of Households (in million) 25.7
Average Size of the Households 2.4 Persons
Percent of Households of 1 Person 29.1%
Percent of Households of 2 Persons 28.5%
Percent of Households of 3 or 4 Persons 27.7%
Percent of Households of 5 Persons and More 6.0%

Source: Central Survey Unit, 2006-2007; Trends in Europe and North America, The statistical yearbook of the Economic Commission for Europe, UNECE., 2008 - Latest available data.

 

Consumption Expenditure

Purchasing Power Parity 202020212022 (e)2023 (e)2024 (e)
Purchasing Power Parity (Local Currency Unit per USD) 0.710.680.670.710.72

Source: IMF – World Economic Outlook Database, Latest Available Data

Definition: Purchasing Power Parity is the Number of Units of a Country's Currency Required to Buy the Same Amounts of Goods and Services in the Domestic Market as USD Would Buy in the United States.

Note: (e) Estimated Data

 
Household Final Consumption Expenditure 201820192020
Household Final Consumption Expenditure
(Million USD, Constant Price 2000)
1,998,7412,020,7311,799,992
Household Final Consumption Expenditure
(Annual Growth, %)
1.41.1-10.9
Household Final Consumption Expenditure per Capita
(USD, Constant Price 2000)
30,07430,23426,780

Source: World Bank, Latest Available Data

 
Consumption Expenditure By Product Category as % of Total Expenditure 2017
Housing, water, electricity, gas and other fuels 26.0%
Transport 13.0%
Other goods and services 12.0%
Recreation and culture 9.0%
Restaurants and hotels 9.0%
Food and non-alcoholic beverages 8.0%
Clothing and footwear 5.0%
Furnishings, household equipment and routine maintenance of the house 5.0%
Alcoholic beverages, tobacco and narcotics 3.0%
Communication 1.0%
Health 1.0%
Education 1.0%

Source: OECD Stats, Latest available data

 
Information Technology and Communication Equipment, per 100 Inhabitants 2012
Telephone Subscribers 130.8
Main Telephone Lines 52.6
Cellular mobile subscribers 130.8
Internet Users 87.0
PCs 80.2

Source: International Telecommunication Union, Latest available data

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Marketing opportunities

 

Media in Which to Advertise

Television
Advertising on TV is expensive but reaches consumers massively. For 2016 as a whole, ad spend grew 3.7%, reaching GBP 21.4 billion, marking the seventh consecutive year of market growth. TV advertising’s growth in 2016 was driven by a 12.6% rise in video-on-demand ad revenues.

Main Televisions
BBC (British Broadcasting Corporation)
BBC World
ITV
Channel 4
ITN
Press
In regional or local newspapers, it is suited only for a product with strong potential in a specific region. Specialised magazines are worth considering to reach a focused target. In recent years, printed newspaper circulations have been sliding while online readership has surged. In 2016 the slide in print media continued and ad spend on national newspaper brands fell 10% to GBP 10.1 billion. The national newspapers segment remains important however and the UK is the biggest market in Europe for number of readers of national newspapers.

Main Newspapers
The Independent
The Times
The Sun
Daily Telegraph
Metro
The Guardian
The Economist
Mail
Direct mail can be personalised, customised, targeted and very creative. The volume of direct mail has increased by 87% in the last 10 years, even though in 2016 direct mail dropped 10.4% to GBP 1.7 billion.
In Transportation Venues
Used in major cities on the side of buses and taxis. Also as posters and flat-panel videos in the street. Digital out-of-home was up by over a quarter, but despite its digital growth, the sector saw spend recede overall by 0.6% during the first quarter of 2017.

Market Leaders:
Verifone Media (agency)
JC Decaux UK
Clear Channel UK
Radio
There are many radio stations at national, regional and local level, with a substantial audience. Some stations do not accept advertising. Digital radio offers new channels representing specific interests, with more opportunities for precise targeting. They can also display text, which means advertisements can also include telephone numbers, product information and offers. In 2016 the radio advertising market grew by 5.4% to reach GBP 646 million.

Main Radios
BBC Radio National services.
Virgin radio - national commercial pop and rock station
Talk Sport - national commercial sports station
Classic FM - national commercial classical music station
Web
Online ad spend continues to grow via internet revenues, including digital across news and magazine brands, TV and radio. Digital formats continued to dominate, with internet ad spend up 13.4% to GBP 10.3 billion for the 2017. Mobile accounted for 99% of this growth, with ad spend for mobile platforms scoring a record increase of 45.4% to GBP 3.9 billion. There were more than 60 million internet users in the UK in 2016, nearly 93% of the population (Internetlivestats). Around 64% of British people have an active social media account, with Facebook being the leading platform.

Market Leaders:
Jellyfish
AUK
Media Agency Group
Main Advertising Agencies
Saatchi & Saatchi
Publicis Groupe SA
WPP Group plc
Dentsu Aegis
 

Main Principles of Advertising Regulations

The information in this section is subject to change and regular updating during the UK's post-Brexit transition period. We will publish the updated information as soon as it becomes available.
Beverages/Alcohol
The rules have been strengthened particularly with the intention of protecting the young in the four areas where they may be considered vulnerable to alcohol misuse: sexual behavior, immoderate drinking, youth appeal and anti-social behaviour.
In the United Kingdom, the Advertising Standards Authority has banned several ads that don't comply with the restrictions in the EU directives. Nevertheless, starting January 31st 2020, the date of the UK's departure from the EU, the UK will no more incorporate new EU legislation into its national regulation.
In Scotland, the Alcohol Act of 2010 introduced a number of restrictions on discounts and special offers related to alcohol products. Promoters are therefore urged to seek legal advice before carrying out alcohol promotions in Scotland. For more information visit the website of the Advertising Standards Authority.
Cigarettes
On 14 February 2003 the Tobacco Advertising and Promotion Act 2002 came into force, prohibiting the advertising and promotion of tobacco products. It does not, however, cover advertisements for rolling papers or filters and does permit certain tobacco advertising at point of sale. The relevant EU directives banning tobacco advertising apply within the United Kingdom, in addition to UK laws restricting tobacco advertising. The EU Tobacco Advertising Directive bans tobacco advertising in printed media, radio, and internet as well as the sponsorship of cross-border events or activities. Nevertheless, starting January 31st 2020, the date of the UK's departure from the EU, the UK will no more incorporate new EU legislation into its national regulation. For more information visit the website of the Advertising Standards Authority.

Pharmaceuticals/Drugs
The advertising of medicinal products in the UK is controlled by a combination of legislation and codes of practice. The 2 main ones are: the Medicines (Advertising) regulations 1994 and the Medicines (Monitoring of Advertising) Regulations 1994. Consult the text on the website International Comparative Legal Guide Series. The advertising of medical products is regulated by the European Council Directive 2001/83/EC.
Nevertheless, starting January 31st 2020, the date of the UK's departure from the EU, the UK will no more incorporate new EU legislation into its national regulation.
You can consult the UK Government’s guide on how to promote pharmaceutical products here.
Other Rules
As a general rule, all marketing and advertising must be: an accurate description of the product or service, legal, decent, truthful, honest, socially responsible (not encouraging illegal, unsafe or anti-social behaviour). Consult the UK advertising codes here.
Use of Foreign Languages in Advertisement
Retailers must ensure that all goods they sell display the compulsory information, in English, on each item. Generally, if an advertisement contains any foreign languages or signs, the advertiser must provide an English translation for them.
Organizations Regulating Advertising
Advertisers Standards Authority
Committee of Advertising Practice
Ofcom

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Latest Update: November 2022