Cost of living likely to hurt Christmas spending
People aged 65 and over were least likely to say that they had to reduce their gift buying budget
Four in 10 consumers have said that they will be spending less on Christmas presents this year, according to data from KPMG UK.
However, 45% of those surveyed stated that their budget for Christmas presents remained the same as last year.
Only 4% of all the consumers surveyed said they would have more to spend on gifts this Christmas.
Those saying they will have to cut back their gift budget were most commonly aged 35-44.
People aged 65 and over were least likely to say that they had to reduce their gift buying budget.
Linda Ellett, UK head of Consumer Markets, Retail and Leisure for KPMG, said: “Unsurprisingly, the higher cost of living looks set to take its toll on Christmas spending for many households. Four in ten consumers told us that their gift buying budget will fall this year, whilst a third said they will spend less on festive groceries and do less eating and drinking out.
“The largest percentages of people said that their spending will remain the same this year, but only small amounts of households said that they were in the position to spend more this Christmas. Even for those spending the same – the volumes that they receive may well be less due to inflation.”
She added: “The upshot of this for retailers is continued competition for shrinking consumer spend and reduced volume and a need to capture audiences via strong campaigns, well targeted promotions and discounting and great customer experience.
“Older consumers told us that they were least likely to have to cut their gift buying budgets – so focus on that group and the presents for kids and grandchildren may be key. Retailers will of course also know that getting people of all ages spending early on Christmas gifts can often mean they end up spending more overall due to the likes of late impulse purchases.”
