Christmas spending survey 2013
Savvy shoppers, stabilising spend
Irish festive spending to decrease slightly in 2013 by 1.7%. Once again Ireland will be Europe’s biggest festive spenders. Majority of purchases will still take place offline
The annual Deloitte consumer survey of Christmas spending predicts that Irish consumers will once again spend more than their European counterparts this festive season. Consumers do intend to curtail spending slightly, a trend observed over the last four years. Irish consumers have indicated they will spend 1.7% less this Christmas. This is in line with last year while in 2011 Irish consumers indicated that they would spend 7.44% less. In 2010, there was a 10.6% reduction planned in spending.
Despite spending more than consumers across Europe, Ireland is one of five countries who plan to spend less. Consumers in France (-0.9%), Portugal (-2.3%), Italy (-2.4%) and Greece (-12.8%) also intend on decreasing their spending.
The findings show that the average spend per household in Ireland, excluding any spend on travelling, will be €894, with an average of €484.81 spent on gifts, €258.84 spent on food and €150.76 spent on socialising. In line with previous years, consumers in Luxembourg will spend €825 this year, followed by consumers in Finland, who will spend on average €692.
The majority of Irish Christmas budgets will go on gifts (30%), followed by food (28%), and socialising (24%).
While Irish consumers continue to be less pessimistic with regards to the economic situation in Ireland, sentiment with regards to spending power is mixed. 16% of consumers believe they have more to spend when compared with last year. 36% believe they have the same amount to spend, while 48% of respondents indicated that they have less to spend.
Looking to the next year 26% expect their spending power to improve, while 33% believe that it will stay the same. 22% believe that it will deteriorate and 19% are unsure as to how their spending power will fare in the coming twelve months.
Commenting on the figures, Kevin Sheehan, Partner, Deloitte said: “The findings suggest that, as ever, Christmas is an extremely important time for the Irish and they will celebrate accordingly. While Irish consumers will spend marginally less, retailers will be enthused somewhat that the rate of decline in spending has stabilised and is in line with last year. That said, retailers will need to remain extremely focused on ensuring that they position themselves appropriately with consumers. The impact of austerity over the last number of years remains to the forefront of Irish consumers’ minds, and the survey results show that this is still having an effect on spending during the festive season.”
In terms of changing their purchasing behaviour, 22% of Irish respondents have indicated that they will focus more on buying products and gifts that are on sale, while 13% will focus more on buying useful gifts. 56% of respondents indicated that they will reduce the amount they buy on impulse.
Loyalty and reward programmes influence Irish consumers’ decision making, more so than their European counterparts. Perhaps unsurprisingly, immediate discounts such as cash off, was deemed most effective, as identified by 43% of respondents. This was followed by earning points to earn vouchers for use in several retailers (17%), earning points to earn vouchers for use in the store of purchase (14%) and future discounts (13%).
In terms of timing nearly half (47%) of Irish consumers’ Christmas shopping has been completed before December. 32% will purchase their Christmas gifts in the first half of December, with the remaining 21% spreading it over Christmas.
Interestingly, Irish female consumers are more likely to purchase earlier, with 38% of female respondents indicating that they will purchase in November.
The main reasons identified for spending less this festive season are the economic downturn (48% compared with 57% in 2012), the impact of tax on their income (24% versus 40% in 2012) and debt (24% versus 27% in 2012).
Multi-channel strategy remains important for retailers
This festive season Irish consumers will use various channels to search for, compare and finally for buying products. In terms of searching for products, 38% indicated that they would do so both online and in store, 40% would do so in store and 22% would do so online.
With regards to comparing products, 50% of respondents will do so both online and in store, 34% would do so in store and 16% would do so online.
In terms of actually purchasing products 72% of respondents indicated that they will buy in store, while 28% will purchase online. The gifts most likely to be purchased online by Irish consumers are music, movies and books. 44% of Irish consumers that bought online last year will do so again, but at an earlier stage. Interestingly, Irish consumers are among the highest users of smartphones and tablets for purchasing gifts in Europe – 39% of respondents have already used one of these devices to make a purchase and 54% intend to do so in the future.
This year’s survey also asked consumers what they deemed were the most important attributes of a retailer. Offering the lowest prices ranked top, followed by offering personalised promotions and offers, and a loyalty programme with rewards that are valued by the consumer.
“Retailers need to remain cognisant of how consumers come to a purchase decision, and indeed where they carry out transactions. While online is important in terms of decision making, it is just one important element from a consumer’s point of view in terms of the overall transaction. Indeed when asked what areas retailers should invest in, lower prices ranked first unsurprisingly. This was followed by the customer relationship, home delivery, self-scanning check outs and sustainability.”
For those Irish consumers that do intend to buy gifts in stores, the most favoured options are, in order, speciality chains, supermarkets and traditional department stores. With regards to food the top three locations of choice are large shops, hard discount shops and traditional food shops respectively. The survey also finds that consumers have a preference for brand labels in hypermarkets.
Christmas wish list
The top 10 gifts adults in Ireland would most like to receive are:
5. Gift vouchers
8. Food and drink
The top three gifts most likely to be purchased for family and friends are:
2. Gift vouchers
The average value of a gift voucher purchased this festive season in Ireland is €38.
Irish consumers will, on average, spend 30% of their Christmas gift budgets on their own children, and a further 15% on other people’s children. Video games (31%), books (23%) and gift vouchers (22%) are most likely to be bought for teens. Games (35%), books (34%) and dolls and cuddly toys (29%) are most likely to be bought for the under 12s.
Notes to editors
In order to get a comprehensive view of spending, the survey asks questions regarding what percentage increase/decrease consumers believe they will spend in addition to further questions on how much they believe they will spend. In value terms, Irish consumers have indicated that they will be spending the highest average per household across the countries surveyed. This allows us to both get a feel for the cost of Christmas, but also whether consumers are planning to spend more or less.
About the research
This is the twelfth year Ireland has participated in the Deloitte Annual Christmas Spending survey. This year’s survey was performed during the second and third week in September. Respondents are aged 18 years and older. Information has been collected via internet, with a structured questionnaire for a sample of individuals with controlled panels. Each consumer in the panel is identified through the following dimensions: socio-demographic, personal interests and consumer behaviour. The survey was carried out in 18 countries from Western Europe, Eastern Europe, and in South Africa. The sample size in Ireland was 773.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/ie/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.
The information contained in this press release is correct at the time of going to press.
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