It’s September. The sun is still shining (just!), but there’s a slight chill in the air. It’s a strange combination of Aperols and slippers for the next few weeks as the weather slowly makes up its mind between seasons. But there’s something else in the air. That dreaded noise is back. Sleigh bells…
When is it too early to start thinking about Christmas? You might say October, some say November. But the stark reality is, at least in the minds of consumers, Christmas planning has already started. For retailers and grocers, that planning started way in advance.
For consumers, Christmas isn’t necessarily all fun and games. It’s important to remember the financial context of this year, with households being continually squeezed when it comes to expenditure. With 89% concerned about the rising cost of living, 90% about the rising cost of energy, and 88% about the rising cost of food, it’s no wonder we are seeing new budgeting and spending patterns emerging as a result.
But last year, we saw quite the same picture. Consumers are used to the squeeze this year, and you could say that strategic spending and planning has become engrained into the Christmas shopping experience. Consumers are finding ways to manage, and the result could be a much more positive outcome than previously predicted. One of the ways in which this financial management is likely to materialise is the spreading of costs over several months, with shopping starting sooner. Below, we see that a significant proportion of shoppers will be getting started early on.
It’s clear that behavioural patterns are set to look a bit different this time round. 54% are planning to buy fewer gifts for people they’re not as close to this year, 53% say they plan to spread out their Christmas spending, 47% have been more conscious of their finances and looked to save consistently, and 32% are going to have to use their savings to pay for Christmas.
It’s also likely that we’ll see a larger emphasis placed upon deals and discounts as the big day approaches. When we asked people how they expect to interact with sales periods this year, 40% say they are holding off spending on gifts as they anticipate getting a better deal closer to Christmas, 69% will be inclined to use vouchers and take advantage of special offers, 55% will be looking to pre-Christmas sales to buy gifts and 39% will use Black Friday to buy gifts for Christmas.
But how much do these figures alone actually tell us? Sure, it’s useful to have an early understanding of what people say they are likely to do. But the reality is that whilst you can do all the advanced planning in the world, the say-do gap always throws a spanner in the works. Even after pouring over the figures above and creating a robust strategy, there’s always gap between what people say they are going to do, and what they actually end up doing. Additionally, there are always a mulitude of factors that come into play abruptly and spontaneously, so when this happens, are you going to just stick blindly to the plan regardless?
Crucially, planning doesn’t end when the products hit the stores. How can retailers and grocers ensure that they are maximising their potential throughout the coming Christmas period, even once its in full swing? There are three key areas to focus on.
- Supply chain
Is your supply chain able to cope with changing demand? When certain products sell quicker or slower than anticipated, how malleable is your supply chain process, and will you be able to adapt with agility when an unexpected best seller emerges?
2. Communication and media
You need to consider how quickly and effectively you can hop on a trend, and how flexible your media plan is. How quickly can you push out content as trends as they develop, and do you have the freedom to alter media spend and use targeted audience approaches where necessary?
3. Micro and macro moments
Christmas isn’t just Christmas Day. It may seem like an obvious point, but a key route to success lies in your ability to identify opportunities for ‘moment creation’. Can you stimulate spend around key moments throughout the Christmas period? Pre-Christmas gatherings, work dos, early Christmas meals with other relatives – each of these moments can be used to create spending opportunities.
There is still time to influence success during the Christmas season. Only by keeping abreast of the latest changing behavioural patterns can brands, retailers and grocers hope to stay on top, right the way up to the big day.
To get a customer programme in place with vital behavioural insights, get in touch with Becki Jarvis or Rob Nicolson today.