Countdown to Christmas as retailers maximise seasonal shopping opportunities
Twas the month before Christmas and throughout Northern Ireland, retailers have been gearing up for the ‘most wonderful time of year’ – so what can we anticipate from seasonal shoppers?
There are many traditions at Christmas that people are very strict at sticking to and one of the first thoughts in people’s minds ahead of the festive season is food.
From savoury appetisers to the trusted chocolate favourites, consumers are sticklers for ensuring their cupboards and fridges are as well stocked as can be.
For retailers there really is no other shopping period that can compare – from gifting to dinner preparation and stocking up on the essentials, November and December are critical months in the industry.
While the ongoing cost-of-living crisis is inevitably curtailing some Christmas spending as consumers remain more considered about what they’re putting in their trolleys, Christmas is the one time where people are willing to spend a little more than normal in order to make it a special time for families and friends.
This Christmas grocery retailers will be hoping to emulate the covid bump which saw growth in the Northern Irish grocery market accelerate to 12.9% in the 52 weeks to 27th December 2020.
Over the next couple of weeks, consumers will seek out the comfort and familiarity of previous festive seasons and find pleasure in the innocent delights of items such as the selection box.
Sweet treats remain an essential purchase for consumers at this time of year, with store cupboard staples such as boxes of biscuits and tubs of chocolates, retailers are stocking up on these items earlier and earlier each year.
Christmas desserts are another key component and stores such as M&S and Lidl continue to maximise this opportunity with a range own-brand desserts, from Lidl’s Melt in the Middle Pudding and Irish Christmas Cake from their Deluxe range, to Christmas Jumper Colin the Caterpillar and Christmas Caramel Cake from M&S.
It’s said that ‘money can’t buy happiness’, and most Brits (74%) believe that it can’t buy a happy Christmas either – according to the latest Mintel festive research. This is just as well, as just over half (51%) of consumers say that financial concerns will mean their household keeps to a stricter budget this Christmas.
With the cost of living a constant theme this year, a cautious 56% of consumers say that news stories about ‘shrinkflation’ mean they will be looking more closely at prices this Christmas. Overall, three in 10 (28%) consumers expect to pay for more Christmas spending on credit this year, up from 22% in 2022.
Meanwhile, the research also reveals that a quarter (25%) of Brits expected to wait for promotions/discounts (eg Black Friday) before buying festive gifts.
Mintel forecasts retail sales by value in November and December (both for in-store and online food and non-food) to hit £94.5 billion. This represents an increase of 3.6% compared to last November and December when sales reached £91.2 billion, but this year’s growth is solely driven by inflation. In addition, total sales by volume are forecast to decline by 2.9% as the market is hit by reduced discretionary spending.
Nick Carroll, Category Director of Mintel Retail Insights, said: “There’s little doubt that festive 2023 will be a challenging period for retailers, with over half of shoppers looking to cut back. However, there are signs of a well-timed recovery in confidence ahead of the big day.
“Several weeks ahead of Christmas Day shoppers may be cautious about their spending intentions but, as history shows, once the festive feeling takes over some caution is thrown to the wind. This should mean more opportunity for retailers this December compared to last year.
“The recovery in confidence is being driven by higher earners, while lower earners are still facing a further year of financial pressures. This will mean a highly polarised spending period, with value still high on the agenda for many.
“This environment lends itself well to Black Friday promotions, and the earlier launching of deals and the scale of retailers already engaging in the event mean all signs point to the event being as large as ever.
“Brands and retailers can cut through this festive period by giving some much-needed mood-boosting relief after another difficult year. Tapping into this feeling, the tone taken by most marketing campaigns so far has been more playful,” he added.
“Customers will be looking to keep a lid on spending while having a good time, and this makes it more tempting to splash out on lower-priced pick-me-ups, such as value fashion or premium ready meals.
“There’s also the chance for grocery retailers to receive a boost from the switch away from out-of-home spending by trying to recreate the benefits of eating and drinking out, from the comfort of people’s homes. For retailers as a whole, there’s everything to play for.”
TO VIEW THE FULL FEATURE IN THE NOVEMBER-DECEMBER ISSUE OF NEIGHBOURHOOD RETAILER, CLICK HERE
