Updated: 14th April 2020
Harnessing Consumer Christmas Spending
For many of us, Christmas is synonymous with the food and drink central to so many of our gatherings and celebrations at this time of year. All this eating must be fuelled by a whole lot of shopping – and supermarkets are only too happy to help consumers stock up on the goods they need to celebrate in style.
The importance of seasonal spending
Seasonal spending is hugely important for supermarkets throughout the year; by far the most lucrative of such events is Christmas. With Britons set to spend an average of £567 on celebrating the festivities – far more than any of our European counterparts – Christmas is a crucial period for all retailers, not least our supermarkets. With the average household earmarking £380 to spend on groceries during December alone this year, supermarkets are keen to ensure this money passes through their tills rather than those of their competitors.
While supermarkets have not been as badly hit as the high street with falling footfall and the seemingly unstoppable online shopping trend, they are still facing challenges. Increases to the National Living Wage, Brexit uncertainty, as well as aggressive competition from the German discounters, Aldi and Lidl, have lead to the ‘big four’ hoping for some festive relief and to grab a slice of the £29.3bn which rang through supermarket tills during the festive period last year.
A disappointing year for the big four
Over the past 12 weeks, Asda and Morrisons have seen sales fall by 1.2 per cent and 1.7 per cent respectively, while the other players of the so-called ‘big four’, Sainsbury's and Tesco, have fared slightly better yet have also experienced drops of 0.2 per cent and 0.6 per cent. For supermarkets keen to reverse recent disappointing sales figures, Christmas cannot come soon enough.
Keen to extract as much value out of Christmas as possible, supermarkets have made an early start on getting festive goods out on the shelves; mince pies and selection boxes have been in the shops for several weeks, jostling for space amongst Halloween themed treats and bonfire night sparklers. However, now we are deep into November, Christmas can fully take over and the supermarkets are only too happy to oblige.
Retailers will be pleased to hear that as November draws to a close, Christmas spending has already started in earnest as shoppers begin to stock up for the upcoming holiday season. While it may be too early to buy many components of the traditional Christmas dinner, this hasn’t stopped shoppers making a start on filling the cupboards with less perishable products to put away for the big day.
More than £17 million has already been spent on mince pies, while shoppers have parted with over £3 million to secure a Christmas pudding, demonstrating that it is never too early for retailers to start their Christmas campaign.