Premium food apart from clothing and technology purchases are expected to drive a five per cent jump in festive spending to £22.7 billion this year, according to figures that suggest UK consumers will outstrip the first post-pandemic Christmas in 2021.
The average spending on gifts and celebrations is expected to rise from £416 to £433 for each person, the survey of 2,000 adults by the accountancy firm PwC found.
The research suggested that spending will exceed the £21.6bn, or £426 for each person, recorded in late 2021, when consumers were able to return to more normal festive socialising after Covid-19.
Consumers named food and drink and Christmas dinner as the top spending priorities for 2024, suggesting that they might opt for more premium ranges, PwC said.
Clothing was the top spending priority for under-25s and third overall, according to PwC, giving hope to retailers that people will buy new outfits after several years of holding back. Strong spending on technology during the end-of-November Black Friday promotions is expected to continue through December.
PwC said British consumers have a “well-established habit of spending more than they initially plan during the festive season”.
Lisa Hooker, who leads PwC’s consumer markets work, said she was “cautiously optimistic about the outlook” after consumers showed “caution” during the autumn as they awaited tax increases from the government.
“After volume declines for most non-food categories in 2024, it is good to see a relatively strong end to the year with increased spending over Black Friday, which is expected to continue over the festive period,” she said.
“As usual the winning category is food and drink with growth in the premium ranges exceeding value ranges as customers want to selectively treat themselves and their family.”
PwC's figures coincide with Kantar's report which states that grocery sales are expected to exceed £13 billion over the four weeks of December for the first time ever with December 23 expected to be the single busiest day.
Fraser McKevitt, head of retail and consumer insight at Kantar, said, "Sales of assorted sweet biscuits and biscuits for cheese both doubled in November compared with the month before, while eight per cent of us bought a Christmas pudding."
McKevitt added, "Shoppers are grabbing the chance to spend that little bit more than usual on Christmas specials, and champagne, wine and spirits saw the biggest levels of buying on deal.”
