More than a third expect to reduce holiday spending compared to last year as a result of the cost of living crisis. Shoppers must make difficult decisions this Christmas.
Prioritizing spending on Christmas meal and presents for the kids
Income available to households on average drops to a four-year low.
Children all around the country can sigh with relief this Christmas because, according to new Asda study, families plan to prioritise spending on their gifts while making cuts in other areas.
According to the supermarket’s most recent Mindset study, 92% of customers intend to spend the same amount or more on their kids this year despite having smaller finances because of the rising cost of living. 90% of families said they planned to keep or increase their expenditure on the customary Christmas Day supper.
To stretch their holiday finances further, families are expecting to make savings elsewhere, with more than half (54%) intending to spend less on Christmas decorations. Spending less on gifts for friends and family members than in previous years is another way to save money.
Christmas spending is being prioritised because many families are in a tight financial situation. According to the most recent Asda Income Tracker, which tracks household disposable income, the typical UK household is £142 worse off than it was in October of last year. The sharp increase in energy expenses, which have increased by approximately 90% year over year, is the main cause of the decline in disposable income.
In October, the average household had $203 left over each week after paying taxes and basic expenditures, the least amount since August 2018.
Asda has expanded its Christmas assortment to include more than 700 products at all price points to accommodate a variety of consumer budgets and is doing everything it can to help families enjoy the festivities.
This year, the supermarket increased the capacity of its online delivery service and would provide more than one million home delivery and click & collect slots, including for the first time, deliveries on Christmas Eve.
On November 1st, it also launched its Winter Warmers incentive at its cafes, allowing customers 60 and over to enjoy unlimited soup, rolls, and tea or coffee for just £1 in any of its 205 cafes throughout the day. This is concurrent with its wildly successful Kids Eat for £1 deal, which has served more than 770,000 meals since its inception in late June.
* The Asda Income Tracker is a measurement of “disposable income,” indicating the amount left over after taxes are deducted from the income of the typical UK household and essentials like groceries, electricity, gas, transportation expenses, and mortgage interest payments or rent have been paid. The Income Tracker calculates how much is left over for luxuries like entertainment and recreation products and services.