Spending in the UK over the Christmas period is expected to reach £84.9 billion in 2023, representing a decrease from the year prior when accounting for inflation, according to new research.
That figure is 3.3% higher than Christmas spending in 2022 which stood at £82.2 billion on a reported basis but with inflation currently at 6.7%, the effects of higher prices are being felt and households may be scraping back some of their spending during the cost-of-living crisis.
Overall spending per household for the big day is expected to rise close to 1% to £823.40, according to figures from GlobalData analysed by Vouchercodes.
With volumes predicted to slip by 4.1%, researchers are expecting both online and in-store channels to experience sales growth of 3% and 3.5% respectively, albeit with offline revenues making up around 64% of total sales.
Shoppers are expected to rely on savings this year-round, with households less likely to use gift cards, buy now pay later schemes, or payday loans to finance their gifts – although there has been a spike in those considering using a general loan to cover expenses.
Areas like the Southeast and the East of England are predicted to see the smallest increases in spending, although the former is one of the biggest shoppers, accounting for around £13 billion of the country’s Christmas sales.
VoucherCodes.co.uk senior commercial director Michael Brandy said: “After a year of price rises and high inflation rates, it comes as no surprise that consumers are planning on cutting back on their Christmas spending this year, and unfortunately retailers are set to bear the brunt of these cuts.
“With limited budgets, consumers will be prioritising value above all else so offering deals, discounts and affordable prices will be vital in encouraging customers to part with their hard-earned cash this Christmas.”