At Revolut, we understand data. Through the millions of transactions our customers make every day, we can spot emerging trends months before they materialise in the polling booth.
The UK is our home market and biggest customer base, with 7.6 million customers. We have a significant presence across all 650 UK constituencies, from our 1,300 customers in Na h-Eileanan an Iar to our 57,000 customers in West Ham.
The average UK constituency has 11,000 Revolut customers spending more than £20m per year. The average age of our customers – 37 years old – is just three years younger than the median age in the UK. Moreover, we have at least 5,000 customers in 151 of the 158 marginal seats in the country (those with a majority of fewer than 5,000).
In other words, every time a customer buys a coffee, pays a bill or splits a meal with a friend, that gives us a data point, which when viewed with millions of other transactions at a macro level, gives us a unique perspective on nationwide consumer spending. This is why the Office for National Statistics uses our data to monitor national weekly spending trends.
But what does this mean for the next election? Every political party understands the cost-of-living crisis is the key concern for voters. We have analysed our data in the top 25 target seats for Labour, the Conservatives and the Liberal Democrats since the 2019 general election to identify spending trends that could decide the result.
For Labour’s top 25 target seats, the data from the 236,000 Revolut customers in these constituencies revealed that over the last 12 months (1 September 2022 – 31 August 2023), constituents spent on average 2.3 per cent more compared with the same period in 2021-22. Spending on essential goods (groceries, public transport and utilities) in the last 12 months increased by 6.1 per cent but spending on discretionary goods (restaurants, services, shopping, travel and entertainment) only increased by 1.2 per cent. This indicates that likely voters are being forced to hold back on spending, because of increasing costs of essentials due to inflation.
Voters in these target seats spent £11.6m on average per constituency, which is less than the £23m average across all 650 constituencies, signalling that these constituents could be feeling the economic pinch more than the average person. For this specific data set, we excluded Kensington from the results as it is an outlier within the data, with 41,311 customers (compared with 8,115 on average in the other 24 constituencies) and a total spend of £168m in the last 12 months.
Labour’s opportunity here is to highlight that the voters in their top target seats have not increased their spending power over the last 12 months and are spending more on essential goods than they are on non-essential goods. They are also arguably facing a greater impact of the cost of living compared with the national average – due to less total spending.
For the Conservatives’ top 25 target seats, the results were different. Looking at the average spending of the 209,000 Revolut customers in these constituencies, these customers spent 14 per cent more in the last 12 months. Compared with 2021-22 spending, these customers spent 14.9 per cent more on essential goods and 13.6 per cent more on non-essential goods in the last 12 months. However, these constituents collectively spent an average of £12.6m per constituency, which is still significantly less than the £23m average across the entire UK. This means that each constituent spent £466 less than the average Revolut customer in the UK in the last 12 months.
In contrast to the target Labour constituencies, while voters here have also been impacted by inflation their discretionary spending has continued to grow. They are, therefore, likely feeling more optimistic about the economy and their future prospects.
The Conservatives could stress to these constituents that they are better off than they were in 2021 and 2022 because they are spending more on average. But they should also be aware that the constituents in their target seats are still spending significantly less than the national average.
For the Lib Dems’ top 25 target seats and the 328,000 Revolut customers in these constituencies, average spending increased 6.9 per cent in the last 12 months. Over the last 12 months, these customers spent 8.6 per cent more on essential goods and 6.4 per cent more on non-essential goods. These customers also spent an average of £35m per constituency, which is significantly more than the £23m average. Despite the spending power of these constituencies being significantly higher than the national average, these customers have still seen a comparable impact of the cost of living on their spending. But it is unlikely that the Lib Dems can massively push cost-of-living arguments given the average constituency spend, which is good news for the Tories – 22 of these 25 seats are Conservative-held.
The data provides a valuable insight into the financial lives of 773,000 voters in the most important seats for these parties at the next election. Just 89,000 votes are needed to flip all 75 of the parties’ target seats. Inflationary pressures and the impact of the cost of living can be seen across all of these constituencies, but it has been felt differently. A one-size-fits-all approach to messaging will not work here. Whichever party comes up with the most effective strategy to recognise each constituency’s unique economic impact could swing these seats in their favour and decide the election.