Yahoo Finance Christmas: Two-thirds of shoppers cutting back on spending
Two-thirds of Brits are spending less on their Christmas shopping this year as the cost of living crisis continues to bite.
Despite spending the last two Christmases under social restrictions, three-quarters (75%) of people admitted that they are still not planning a big celebration, new research from Accenture said. Meanwhile, just 16% are planning a big celebration post-COVID.
With rising inflation and lower wages, households are looking at several ways to cut back on costs this festive season.
The top methods were reducing the number of presents (49%), less eating out (46%), less general socialising, and decreased spending on food and drink at home (both 35%).
Of those planning to reduce spending this Christmas, almost half (45%) said they would be buying food from budget friendly supermarkets.
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The research, which surveyed 4,200 UK consumers, also showed that almost 3 in 4 (73%) of parents with children aged between 12 and 18 have already, or are intending to, make a conscious effort to reduce the amount of heating they use. This compared to 56% of respondents without children.
In addition to this, 71% of families with children said they are re-evaluating their food shopping habits to make food go further, dropping to 54% of respondents without children.
Meanwhile, only 2 in 5 (39%) are planning to take advantage of discount events more than last year, such as Black Friday, and Cyber Monday.
Of the small minority (16%) who are planning a big celebration, just 38% said they will have to dip into their savings, while over two in five (44%) will be shopping early or spreading the cost.
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“The fact that shoppers are planning to spend less on gifts this year reflects just how low the mood feels in the run up to this Christmas," Kelly Askew, retail strategy and consulting lead at Accenture, said.
"As consumers continue to start their shopping earlier each year in a bid to spread the cost, it’s time for retailers to get creative with their marketing and offer ‘solutions’ to their customers rather than just ‘items’,”
She added: “For example, creating cost-effective bundles for festive grocery meals or complete fashion outfits, or offering gift cards with bonuses to incentivise customers while also locking in cash flow.
“Retailers should also look to educate consumers and families, helping them to shop economically and sustainably where possible. Taking clear steps to support people during this difficult time is the right thing to do and will encourage more loyalty among consumers.”
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It came as a parallel survey of 150 UK retail executives found that retailers are also wary of declining consumer confidence.
Four in five (84%) identified this as a factor in influencing their strategy for the festive season, with over a third (34%) reporting it to be a very significant influencing factor.
Other notable factors included rising inflation (94%) and supply chain disruptions (91%).
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