Monday, July 15, 2024

Christmas gifting spend to drop

This year’s holiday season will see shoppers spending less per head but more purposefully.

According to a new survey by the Australian Retailers Association (ARA), in collaboration with Roy Morgan, 30% of surveyed shoppers will cut their Christmas gifting budgets in 2023. 61% of respondents will look to maintain last year’s spending and 9% intend to spend more.

As a result, the average gifting spend is tipped to be $646 per person, down from $700 in 2022.

Toys and games will be the most-sought after gifts (mentioned by 20% of respondents) – propelled by the “resurgence” of Barbie – followed by gift cards (18%), and clothing shoes and sleepwear (16%).

The ARA’s latest sales predictions with Roy Morgan forecast Australians will spend $67.1 billion in the lead up to Christmas this year, up just 0.6% on 2022.

ARA CEO Paul Zahra says Christmas shoppers this year will be much more considered and deliberate in their spending.

“Many Australians are under significant financial pressure, and their Christmas gifting behaviour will reflect this,” he says.

“A big part of their buying mentality will be geared towards bang for their buck. Shoppers will actively seek out good deals but they’re still looking for gifts that reflect their personal values.

“For retailers, sales and promotions will be more important than ever this year – especially on the marquee Black Friday and Cyber Monday weekend.

“With increased competition and reduced spending across discretionary categories, retailers will be mindful of shopper’s shifting spending focus and will be motivated to entice shoppers however they can.”

Despite the soft Christmas spending forecast, the Black Friday sales are set to provide retailers with strong results in the lead up to Christmas with ARA and Roy Morgan forecasting record sales of $6.36 billion over the four-day Black Friday/Cyber Monday weekend (24-27 November) – up 3% on last year.

Other findings

  • Around 76% of surveyed Australians will purchase Christmas gifts this year – down 3% on 2022.
  • Most respondents say they will shop at the same time as last year (76%) – but one fifth (20%) say they will shop earlier.
  • Most of the shopping will remain instore – with just over one third (36%) done online.
  • Most surveyed consumers (55%) say their online shopping habits have ‘stayed the same’ as last year while over a fifth (21%) say they are now doing ‘less purchases online’ than last year.
  • Almost half of respondents (49%) will purchase a Christmas gift that is environmentally friendly.

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