Are you preparing for a Christmas without the trimmings? Consumers are cutting back this year as the credit crunch takes some of the jingle out of the festive season.
More than half of shoppers will be spending less on food this year according to the latest consumer option panel from uSwitch. One third has also decided to slash their booze bill. In addition, 15 per cent will be cutting back on the number of people they will invite to Christmas dinner.
Verdict Research is also pessimistic. It predict that spending will raise only two per cent this festive season, the second lowest growth rate in twenty years. If spending of food is stripped out, sells are expected to fall for the first time in a decade.
The consumer chill has prompted the big retailers to battle hard for your business. Mark & Spencer, for example, is enticing shoppers with the number of deals in its Christmas shop.
It has also nominated a couple of days to sell up its stock at a twenty per cent discount-the first time the stock has staged a pre Christmas sale in four years. Other high street names are offering price cuts of up to 50 per cent to lure cash-strapped consumers.
But It’s not just Christmas shoppers who are wary. The credit crunch has forced us all to be a bit more penny-pinching.
Ann Robinson, director of consumer policy at a uSwitch, said, ‘The frugality that people started to adopt earlier this year now looks set to pick up pace and continue through Christmas and into the new year.
Households are preserving cash as very often this is their only protection against market volatility, recession and redundancy. So how has the downturn affected our shopping habits? You can’t afford to be a supermarket snob in recession Britain, so the discount supermarkets are doing roaring trade.
Take Aldi, where you can find many middle-class shoppers on Saturday afternoon. Maybe it’s the whole Canadian lobster at just £5.99! The figures speak for themselves.
In 2006/2007 sales at the store were rising by about 15 per cent to 20 per cent a year. So far this year, they have grown by 26 per cent and in the past three months, they have soared by more than 30 per cent. In a poll conducted by Empathy Research for TalkingRetail.com, over half of respondents admitted that their choice of supermarket had been determined by the economic downturn.
Terry Tyrrell of Brand Union, a consultancy, said: “There has been a major shift from status to value. People are less concerned about them and more about what their choice of supermarket says about them and more about what their choice of supermarket can do for them. Shopping at a discount store has a sort of ‘I am not proud’ inverted chic about it.” Price pressure has made us al much more comfortable about buying own-brand products than we were even a year ago.