UK shoppers will keep retailers jolly this Christmas, spending £20.6 billion on festive foodstuffs and groceries, retail research firm IGD reported Friday.
Forecast figures predict a 1.2% growth over the Christmas season. The modest growth, although accompanied by lower prices than last year, will end up in a strong result for retailers and manufactures, said CEO Joanne Denney-Finch.
“We expect online shopping again to generate the fastest growth this Christmas, with a predicted 9.3% uplift generating £1.2bn in sales. The launch of Amazon Fresh and of Aldi Online this year extends shoppers’ choice and people will also benefit from more one-hour delivery slots, shorter lead times and the growing availability of click and collect from established players.
Discounters will experience a 6.2% increase during the festive period, with sales of £2 billion - a decrease from last year.
Festive food and drink is an important symbol for many shoppers, signifying the start of the season. While a quarter of shoppers begin counting down to Christmas when they see the first Christmas retailer advert, 15% said that finding their favourite seasonal food or drink on the shelf is what kicks it off for them.
More than half of shoppers had gotten an early start on their Christmas food and grocery lists by mid-November, but retailers should still expect the usual late rush. Six out of ten of these early birds said they will use up and replace some of the seasonal items.
Impulse buys still affect 53% of shoppers, whereas 40% said that they are more willing to try new products at this time of year. Browsing helps spark ideas for many of those surveyed. Denney-Finch said this means that retailers need to focus on innovation.
However, frugal shopping habits present during the rest of the year will still apply, although more than half of shoppers tend to splurge on Christmas food and groceries, she said. Forty-six percent of customers will collect points on their loyalty cards in anticipation.
"Competition is set to be as intense as ever and not only on price. Those retailers and suppliers who combine to offer excellent value plus a compelling in-store experience will capitalise on the strong emotional connection between food, drink and Christmas," Denney-Finch added.
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. To subscribe to ESM: The European Supermarket Magazine, click here.
