Christmas 2021: what consumers are buying this year

British shoppers are expected to spend a whopping £6.8bn in the run-up to Christmas Eve, research by NielsenIQ revealed.

With gatherings between friends and family still on the cards, spending is projected to be higher than the £6.7bn recorded last year. While grocery sales fell 2.5% in the four weeks ending 4th December, the market researcher said that a rise in spending in the first week of December pointed to a festive season splurge.

What are shoppers set to buy?

British shoppers are expected to treat themselves this Christmas, with spending on premium and higher value items poised to rise. The average value of the shopping basket is 2.6% higher this year than in 2022, according to NielsenIQ.

The products benefitting from these trends present a picture of holiday parties alongside quick and convenient meal options: celebration cakes (up 15.6% to £15m), pre-mixed alcoholic drinks (up 13.7% to £25m), fresh olives (up 7.4% to £9m), fresh pizza (up 13.1% to £50m) and fresh ready meals (up 11.3% to £195m).

This research indicates positive news for independent fine food retailers and their premium fare. With Omicron not yet dampening spirits, consumers are still planning for a big Christmas celebration. “This year more than ever, we can expect shoppers to plan activities and meal occasions around family and friends,” said Mike Watkins, NielsenIQ’s UK head of retailer and business insight. “The sales figures in November are partly due to lockdown comparatives but also shoppers delaying big shopping trips until the final week before Christmas when fresh foods and any remaining indulgences are purchased.” 23rd December will be the busiest day of trading, he predicts.

Kantar is also predicting a treat-filled Christmas, despite rising prices due to inflation. “As we count down on our advent calendars to the big day, it’s clear that shoppers want to have some fun and make this Christmas extra special,” said Fraser McKevitt, head of retail and consumer insight, at Kantar’s Worldpanel Division, UK.

“Price inflation doesn’t seem to be denting their desire to treat themselves and loved ones, and supermarket premium own-label ranges, such as Tesco Finest and Asda Extra Special, are the fastest growing ranges in store,” he continued. “Last December, we saw sales of premium own-label lines hit more than £587 million, and the figure could be even bigger this year.”

Inflation, Kantar found, is already impacting supermarket prices, including Christmas dinner staples. The average cost of a meal for four is now £27.48, which is up 3.4% compared with last year. Across the board, grocery prices are up 3.2% in the latest four weeks, the highest rate of inflation Kantar has recorded since June 2020. “Consumer behaviour hasn’t caught up with these changes though,” Fraser said. “Habits we’d expect to see shift, like swapping branded products for own label or seeking out promotions, haven’t altered just yet.”

The research comes as Britain recorded its highest number of daily infections since the pandemic began. If the rate of growth continues, by Christmas Day 640,000 Omicron infections would be being recorded. The Scottish government has asked people to limit social contact to two other households – except on Christmas. For fine food independents, whether Christmas parties can go ahead or the Government cracks down on socialising, it appears good food will be at the heart of celebrations big or small.