According to PwC’s latest Festive Predictions Survey, spending on gifts and celebrations this Christmas is expected to reach £22.7 billion, marking a 5% increase from £21.6 billion last year.
Average spending per consumer is projected to rise from £416 to £433. These figures surpass the levels seen over the past two years and are comparable with the first post-pandemic festive season in 2021, when total spending hit £21.6 billion, with an average of £426 per person.
UK consumers have a well-established habit of spending more than they initially plan during the festive season. In a PwC survey conducted in September, 18% of consumers predicted their festive spending would increase. This rose to 20% of consumers by November. Similarly, the percentage of people planning to spend less dropped sharply, from 27% in September to just 16% as the season approached. This trend reflects growing confidence in household finances, bolstered by increased clarity following the October Budget.
Younger consumers are leading the charge in festive spending, with 29% of 18-24-year-olds planning to spend more than last year, followed closely by 25% of those aged 35-44. However, it’s the 45-54 age group that takes the top spot as the biggest spenders, with an estimated average spend of £463 per person, highlighting their role as the key drivers of holiday spending this year.
The research highlights the reasons behind the rebound in Christmas spending after three challenging years. Financial pressures, which heavily influenced consumer behavior in 2022 and 2023, have eased significantly in 2024. Notably, the proportion of people citing "less money to spend" has dropped from 54% in 2022 to 37% in 2024, while those pointing to "negative personal finances" decreased from 57% to 32%, signaling improved confidence heading into the festive season.
A growing number of consumers who plan to spend less are attributing it to fewer gifts to buy (rising from 15% to 20%) and seeing fewer people (increasing from 11% to 16%). This shift aligns with more households opting for a quieter Christmas at home with immediate family or going away on holiday—up from 27% in 2022 to 31% in 2024—rather than celebrating with extended family, which has declined from 73% to 69%. This change naturally reduces the need for additional gifts and spending.
Interestingly, holiday travel plans are gaining popularity, with the proportion of those planning a getaway increasing from 5% to 7%, compared with just 2% before the pandemic. That excludes those travelling abroad to visit family, which remains stable at 5%. Londoners are the most likely to be travelling abroad to see family (11%) or on holiday (14%), while the Welsh are the biggest home-birds with just 1% planning to go on holiday.
Lisa Hooker, Leader of Industry for Consumer Markets comments: “After volume declines for most non-food categories in 2024, it is good to see a relatively strong end to the year with increased spending over Black Friday, which is expected to continue over the festive period. Despite better economic indicators and growing disposable income, consumers have been showing a level of caution across Autumn. With the Budget behind us, more certainty on taxes and a desire to make time together more special, we are cautiously optimistic about the outlook.
“As usual the winning category is food and drink with growth in the premium ranges exceeding value ranges as customers want to selectively treat themselves and their family. It is encouraging to see clothing and electricals increase in importance as we dress for disruption free Christmas celebrations and embrace the latest technology trends.”
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