According to new research by payments services and open banking platform, Tink, climate-conscious consumers are investing in higher-quality goods, even if it means purchasing fewer items in total.
The Tink report analysed the views of 2,000 UK consumers and over 500 UK high end merchants and found that 60 per cent of consumers would rather opt for higher-quality but fewer items, rather than many lower-quality items. Additionally, 43 per cent of consumers surveyed who shop for high ticket and luxury goods say they are doing so more frequently now compared to this time last year. Consequently, merchants in the sector are being optimistic.
In fact, 75 per cent of the merchants surveyed said they expected to maintain or improve profit margins over the festive period compared to last year. Nonetheless, according to Tink, high-end merchants cannot afford to rest on their laurels this festive season. The research suggests a shift to ‘conscious consumerism’ is leading shoppers to be more cautious and considered when buying higher-end items.
This is especially prevalent as Tink noted that 37 per cent of respondents say they would rather give fewer but nicer gifts to family and friends this festive season. Furthermore, 40 per cent say they would rather receive one nice, quality gift than several cheaper items.
Considerations this holiday spending season
Budget remains a key consideration when shopping for higher ticket items. Seventy per cent of consumers surveyed say cost of living concerns mean they are very selective when buying high ticket and luxury goods.
Similarly, many consumers are conscious of the environmental impact of the festive season – with 36 per cent of respondents saying that Christmas brings an excess of low-quality, unnecessary gifts that often go to waste.
This comes as one in four consumers say they want to be more sustainable this Christmas by buying better-quality, but overall fewer, items. Merchants themselves recognise this trend – nearly three-quarters (71 per cent) of those surveyed believe that consumers are more conscious about sustainability when they’re buying during peak season.
Payment challenges
Yet despite signs of growing demand for higher ticket and luxury goods, competition for share of wallet remains fierce. In fact, 81 per cent of merchants surveyed said competition in their sector is higher than ever.
Customer expectations are also at an all-time high, and payments remain a sticking point. Among consumers who purchase high ticket or luxury goods, an estimated 58 per cent worry about payment security. Meanwhile, 31 per cent of high-end merchants say the high cost of managing fraud is a key challenge.
A poor payment experience can also impact conversion rates. Among consumers surveyed who purchase high end and luxury goods, 18 per cent said they get frustrated and concerned when having to enter lots of payment details manually at checkout. These concerns would lead four in 10 (41 per cent) to abandon the transaction altogether.
Lucy Grant, commercial strategy director at Tink
Lucy Grant, commercial strategy director at Tink said: “It’s clear that high ticket and luxury shopping isn’t just for Christmas – sustainability and quality are now front of mind for shoppers. But with this trend comes a heightened expectation for a top-tier customer experience, as consumers expect smooth, secure, and flexible payment options as part of the buying journey.
“Merchants investing in solutions like Pay by Bank – often with payment service providers such as Adyen – can help turn these expectations into a strategic advantage, transforming common pain points into loyalty-building moments that set them apart from fierce competition. Seamless authentication without the need for manual entry, as well as fast refunds, are just two of the benefits of adding Pay by Bank to your checkout.”
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