The share of festive spending is set to move away from traditional High Street retailers with Discounters predicted to pick up a significant percentage of spend in the final days of pre-Christmas trading, according to RetailNext, the leading analytics solution for bricks-and-mortar retailers.
Original research of over 1,000 UK consumers by RetailNext showed that shoppers plan to switch over a third (36 per cent) of Christmas spending budgets from traditional High Street retailers to discount brands, such as Lidl, Aldi, Home Bargains and B&M, rising to 41 per cent of Millennials’ intended festive spending.
While data from PwC suggests retail spend on gifts and Christmas celebrations will rise five per cent year-on-year – the first-time consumers will outstrip festive spending since 2021 – shoppers will continue to express value-based buying tendencies, making them mindful about where they spend and intensifying discounter switching, as Gary Whittemore, Head of Sales EMEA & APAC at RetailNext, explained:
“While the acute pressure on household spend appears to be easing, shoppers aren’t simply snapping back to pre-cost-of-living spending habits. Having learnt savvy and thrifty shopping hacks, consumers have redefined their concept of value. And this is bearing out in expected share of wallet for Christmas, with discounters’ retail offers, such as Aldi’s middle aisle, likely to benefit from these value-driven buying behaviours.”
Famed for the success of its reasonably priced “middle aisle” assortment as well as its value food offerings, Aldi, which overtook Asda as the UK’s third largest supermarket earlier this year, has been ambitiously opening UK stores ahead of Christmas to increase its footprint, with 11 new store openings in November and December. Meanwhile Lidl also opened six stores in December as part of its a multi-million-pound investment in its UK bricks-and-mortar estate, with Kantar’s data suggesting it is now the UK’s fastest growing grocer, with sales up by 6.6 per cent in the run up to Christmas and store footfall rising 10 per cent compared to last year.
This changing of the guard can also be seen in the key anchor stores driving footfall to retail parks in the run up to Super Saturday, one of the busiest in-store shopping days of Christmas when footfall is expected to jump +0.5 per cent according to RetailNext’s footfall index. While M&S topped the key anchor stores that would drive Christmas shoppers to visit retail parks or out-of-town shopping destinations (42 per cent) in RetailNext’s poll, this was followed by discount brands B&M (41 per cent), Home Bargains (38 per cent) and discount supermarket, Aldi (32 per cent).
