NEWS5 September 2022

Brands should prepare for ‘frugal’ Christmas

Cost of Living News UK

UK – Companies should prepare for the most frugal Christmas in a generation as the cost-of-living crisis erodes people’s finances, according to research from advertising agency Mindshare.

Oxford Street, London

Mindshare, a media agency that is part of advertising giant WPP, said its Reality Check report showed four in 10 consumers are worried about how they can afford Christmas this year.

The proportion of people feeling very negative about Christmas was at 14%, almost five times higher this year than it was for Christmas 2021, even when the impact of the pandemic was factored in.

The results are based on a sample of around 1,000 adults from the UK and found that a quarter of those asked felt positive about the festive season – down almost 25% on the same time last year.

Three in 10 respondents expected to rely on credit cards more than in previous years, with the 35 to 54 age group most worried about covering the cost of the festive season.

Two-thirds ( 67%) said they would not ask for many presents this Christmas, while 56% predicted they would spend money on friends and family rather than themselves.

When asked where their focus will be this Christmas, 78% of respondents said they would prioritise saving overspending, 79% predicted they will be staying in rather than going out and 74% said they would be ‘holding back’ rather than indulging.
Mindshare said the results remained reasonably consistent regardless of household income.

Julia Ayling, head of research and insights at Mindshare UK, said: “Regardless of financial position, people will behave very differently this Christmas. All brands, even those that have traditionally been fairly recession proof will need to adapt to this.

“The ‘squeezed middle’ are making changes to make sure their loved ones can still enjoy Christmas. This group needs support from brands to spread cost over a longer period, treat their kids and find alternatives and substitutes that celebrate the joy of giving rather being about the monetary value.

“Let’s not forget that a less commercial Christmas can still be a special one. Tapping into the traditional values of Christmas, and what really makes us happy will resonate with the public this festive season.”