The Value of Optimism
To understand consumers, we need to look beyond consumer confidence.
Hello! Welcome to this month’s long read, usually reserved for paid Slow Futures subscribers.
This month we’re taking the paywall down as we take a deep dive into Trajectory’s Optimism Index as it collects its 100th wave of data. This long read, adapted from a report first published on Trajectory’s Now & Next platform, is all about the value of Optimism - how this humble metric has evolved into a barometer of sentiment more important than consumer confidence.
The Optimism Index 100th wave party continues next Thursday at 9AM BST, with a trends briefing digging deeper into what we’ve learnt from measuring the outlook of the UK public over the last 8 years. It’s free to attend and will be packed full of trends and data. You can register here.
The Value of Optimism
Introduction
April 2026 marks the 100th month since Trajectory started measuring levels of optimism amongst UK consumers. Every month since January 2018 we’ve collected consumer sentiment data from a nationally representative sample of 1,500 UK consumers. Our core metric is the Optimism Index: how do people really feel about the short term outlook?
When we began measuring optimism back in 2018, one of the primary objectives was to understand the relationship between optimism and expectations for spending, particularly on out of home leisure and hospitality. This is discretionary spending: trips to pubs, restaurants, events, cinema and the theatre are optional, we don’t have to spend here. As a result, spending varies widely from month to month.
We were keen to explore spending dynamics other than the most common one - that of spending and consumer confidence. This relationship makes a lot of sense, in theory: consumers who are anticipating an improvement in their own personal finances might well be more likely to have access to higher levels of savings and/or disposable income – therefore allowing them to expect to spend more on out of home leisure as a result.
The last 8 years has taught us that optimism may be an even better predictor of expected spending. One of the main drawbacks of consumer confidence is that this measure is often as concerned with the present or the past as the outlook for the future.
Optimism, on the other hand, is an innately forward facing metric. It examines what consumers think might happen rather than measuring their reaction to what has already happened.
Another crucial point of difference with consumer confidence is that optimism considers more than just the economic drivers of behaviour and outlook.
Whilst finances and confidence in the economy are one factor in defining a consumer’s optimism, they are not the only factors. Our analysis indicates a strong relationship between optimism and other, wider, measures of sentiment, including trust, autonomy, nostalgia and overall life satisfaction. Trajectory’s Optimism Index measures all of these and more, delivering a multifaceted analysis of UK consumer outlook that highlights the areas of nuances blunt consumer confidence tools often miss.
In this long read, we will:
Demonstrate that optimism is a more powerful predictor of spending than consumer confidence
Explore why this might be – including examining the wider factors that optimism measures
Measure the value of optimism and the cost of pessimism through its impact on monthly spending
Optimism As A Predictor of Spending
Our data from last year, 2025, provides compelling evidence of the power of optimism.
The chart below examines average monthly spending expectations across four different categories (out of home food and drink, other out of home leisure, big ticket items and subscription services) and compares the relationship between these spending expectations with two other metrics: overall optimism and household financial confidence.
To examine this relationship, we have calculated the Pearson Correlations, a statistical measure that looks at the extent to which spending expectations rise when both optimism and household financial confidence increase, and vice versa. The strength of relationship is then given as a coefficient value, ranging from a score of 0 to 1, where 0 means there is absolutely no relationship at all, and 1 means a perfect relationship.
The results of this correlation analysis are fascinating. For each of the four categories of leisure spending in 2025, there is a stronger relationship between optimism and spending than between household financial confidence and spending – with a greater coefficient value for optimism and spending in each case.
The differences are relatively minor, yet they nonetheless indicate that there is a stronger relationship between optimism and spending – which provides evidence to suggest that optimism may therefore be a better predictor of future spending expectations than household financial confidence.
Whilst the strength of the relationship between spending and confidence at a topline level is significant, it is important to examine the same relationship when controlling for income, as the topline trend may in part be influenced by the fact that higher income households typically report higher Optimism Index scores and expect to spend more.
The chart below looks only at those earning less than £21k per year. There is a similar trend. Across each of the four categories of spending, there is a stronger correlation between optimism and expected spending than the correlation between household confidence and spending.
This provides even greater evidence of the importance of optimism. Even amongst those with the lowest household income, and typically the least disposable income as a result, higher levels of optimism are still just as likely to drive an increase in leisure spending expectations. Amongst the same sample of low income households, an Optimism Index score of 60 points is linked to almost twice the monthly spending expectations on out of home leisure as an Index score of just 40 points.
Additional analysis shows just how impactful every minor increase in optimism can be.
The next chart looks at expected monthly spending on out of home leisure and subscription services across the Optimism Index spectrum - from a low of 35 (properly pessimistic) to a high of 75 (one foot in the sunlit uplands). Once again, there is a strong positive relationship between the two measures. Optimistic consumers are better consumers: they spend more.
Whilst those with an index score between 35 and 39 points anticipate spending only £123 over the next month on out of home leisure and subscriptions, those with a score between 60 and 64 points anticipate spending almost double this amount (£231). Those with a score of 70 to 74 points expect to spending on leisure almost triple (£371) the amount of those with a score below 40 points.
Even the relatively modest increase in per person expected leisure spending of £25 between those with an Optimism Index score in the early 40s and a score in the early 50s could be hugely significant when extrapolated to the UK population as a whole – with a topline index score at 50 points or above potentially indicating that millions more will be spent on leisure over the course of the next month when compared to a topline score below this threshold.
Why does Optimism matter so much?
Optimism is a broad-based measure of outlook.
It doesn’t just capture the financial components of our sentiment - although that’s there - but also other things: trust, wellbeing, autonomy, nostalgia. It can incorporate elements of seasonality (future expectations as conditions by the arrival of summer, or the run up to Christmas) and our (non financial) feelings about the wider world - anxiety, satisfaction, concern, indifference.
As with spending, examining the relationship between these broader factors and either optimism or consumer confidence further strengthens the case for optimism.
In the next chart we have compared two groups of consumers – those who are the most optimistic about the future, and those who expect their own finances to improve within the next twelve months. Both of these groups would be considered amongst the most likely to anticipate stronger than average levels of spending throughout the next month.
Yet when comparing wider aspects of sentiment amongst these two groups, there are key differences. The group who are the most optimistic about the future show a higher level of choice and control over their life, feel a higher level of life satisfaction, are more likely to feel that life is better than it was 50 years ago, and have a higher level of net trust in politicians when compared to those expecting their finances to improve.
Optimism is a measure that therefore captures a person’s general outlook on the future far better than compared to standard financial confidence, and amidst an increasingly unstable and volatile socio-economic landscape, spending expectations are no longer being impacted simply by financial stability, but additionally by how people feel about the future as a whole.
Consumers with the highest optimism are also considerably more likely to adopt a number of attitudes that are likely to boost their appetite for spending on leisure and hospitality – further strengthening the link between a higher Optimism Index score and greater spending expectations. The optimistic group are considerably more positive about the impacts of technology, are more likely to want to try new products and services, are more likely to enjoy adventure and taking risks and buying the latest fashionable brands and show a greater appetite for spending money on experiences and leisure.
The cost of Pessimism
With optimism playing such a key role in defining spending expectations, it’s a shame there’s not more of it about.
For several years, the Optimism Index has shown that we are a downbeat population. Since the start of 2024, there have been only four months in which consumers have been, overall, optimistic.
This begs the question – given the strength of the relationship between optimism and spending expectations, what is the cost of such prolonged and entrenched pessimism for UK businesses?
To find out, we’ve examined average personal spending expectations throughout each quarter since the beginning of 2023. The same figures are then recalculated, but this time removing all respondents who report the most pessimistic outlook on the future – in order to calculate the extent to which those with the least optimistic outlook are dragging down average personal spending expectations across each of the four categories.
The findings provide strong evidence to suggest that pessimism is having an increasingly detrimental impact on spending expectations amongst UK consumers. Back in Q1 2023, the removal of the most pessimistic adults from the sample saw a £23 increase in the average amount each consumer expected to spend over the four categories of spending (adding them all together).
Fast forward to Q3 2025, and this figure has more than doubled, with those with the most pessimistic outlook now dragging down expected personal spending on leisure by £48 each month.
When looking at which categories of spending are worst impacted by pessimism, the greatest decline is on personal monthly spending on big ticket items, down £19 per person per month as a result of the most pessimistic group. However in percentage terms, this is matched by the fall in expected spending on other out of home leisure activities (non-food or drink), with spending down 17% as a result of low optimism in Q3 2025.
The cause of such a surge in the cost of pessimism since early 2023 is the rapid increase in polarisation in optimism that we’ve seen over the same period. Levels of polarisation - as measured every month in the Optimism Index, have more than doubled since January 2023, when there was on average less than a 10 point gap in Optimism Index score across generation, income, age and region. By the end of 2025, that gap was more than 20 points.
This surge in polarisation across demographics now means that there is a far greater difference in both Optimism Index score, and in average spending expectations, between those with the most optimistic and the most pessimistic outlook when compared to previous years. This therefore also means that the most pessimistic are falling further behind the expectations of the average consumer in 2025, and are therefore dragging down topline spending figures to a greater extent as a result.
What does this mean?
There’s a lot we can take from this analysis. Here are four key things on our radar:
Optimistic Consumers Are Better Consumers. Optimistic consumers spend more, do more and are open to more things. They’re more likely to be receptive to communications and trusting of brands. They want to try new things and prefer experiences to stuff. In short, they’re everyone’s best customers. Understanding who they are is essential.
More than Just Finances. In a landscape dominated by weak political trust, high nostalgia and low life satisfaction, optimism is of even greater importance. Worsening finances are no longer the only factor dampening outlook on the future, particularly when pessimism is so widespread across a significant proportion of the population. With optimism encompassing these wider factors to a greater extent than household financial confidence it may act as a better predictor of spending expectations in years to come.
Spending is Increasingly Sensitive. The strength of the relationship between optimism and spending highlights a potential concern moving forwards. With factors outside of just financial confidence impacting expected spending, there are now a wider range of potential barriers to rising spending expectations. A sharp fall in political trust, for example, could have a more negative impact on spending expectations than in previous years, for example.
Economic Polarisation. With optimism and spending expectations now more polarised across demographic lenses than ever before, organisations may need to refine targeting to specifically reach those groups of optimistic consumers who are racing further clear of the majority of the population.
And here’s three wider macro trends we think this is closely connected to…
Millennial Nation – Amongst those demographic groups that brands may wish to target include Millennials, who have over the last few years reported both the highest optimism of any generation, and who anticipate spending the most on leisure over the next month.
Play Society. Leisure has consistently remained a more important factor for consumers than work for several decades. But recently, this dominance has been challenged - the gap between work and leisure as a priority is closing. As pessimism inhibits discretionary spending, especially on leisure, it’s possible the role of leisure in our lives could weaken.
Agile Fragility. Whilst pockets of optimism are the likely source of more bullish spending expectations, the majority of the population will continue a price conscious and agile approach to spending as a result of enduring pessimism. Our data has consistently indicated that behaviours such as cutting back on non-essential spending, reducing energy usage and shopping around for groceries remain widespread across the country.
More than this
Thanks for reading this long read. For more like this, consider becoming a Trajectory Now & Next member, where you get access to an enormous archive of consumer data, analysis, trends reports and macro trends.
Membership of Now & Next gets you:
✅ Optimism Index - monthly update on how attitudes, spending and behaviours are changing
✅ Our continually updated Horizon Scan, allowing you to prepare for the short and long term future
✅ The whole Trajectory archive of trends content, insight and foresight, including our trends briefing archive on demand, all our deep-dive reports and articles, and the Trajectory Macro Trends.
Find out more and request a demo here.
Everyone has a stake in the future. What’s yours?
Trajectory’s clients and members include household brands, national charities, international agencies and public sector providers. Whether you’re a researcher, innovator, marketer, strategist or thought leader, just drop us a line to find out how you can claim your stake.
Talk to us about an insight or foresight project
We work across the private, public and not for profit sectors to inform product development, segmentation, audience tracking, future strategy or thought leadership. We work across all planning and forecasting horizons, from the present to extremely long term.
 | A guest post by
|