Christmas in the middle of a pandemic is different. Britons spent Christmas last year in lockdown, celebrating only with their household. This caused a negative impact on the retail sector as demand for Christmas products, from Turkey to clothing, was lower than previous years.

However, this Christmas season, McKinsey has forecasted a strong demand as consumers maintain hope for a normal Christmas despite the spread of the new omicron variant. The analysis suggests consumer spending in 2021 will likely rise to 7% over 2020 and 9% over 2019.

Christmas falls on a Saturday this year which means the two busiest shopping dates in countries such as UK, USA, China, Italy, Singapore etc this month are Saturday 18th December- super Saturday- and 23rdDecember, day before Christmas eve.

However, large number of shoppers have been proactive this year and started shopping for Christmas as early as October. Consumers are aware of the shortages, supply chain issues, and longer shipping times, which is one of the reasons for the early shopping this year: 51% of shoppers are concerned about availability, 45% about long shipping times, and 44% about other Covid-19 related issues.

Furthermore, PWC predicts an increase in average spend -from £384 in 2020 to £428 in 2021- due to lockdown savings, pent-up spending demands, and increased confidence and optimism as a result of the vaccine rollout. The average spend is expected to be 12% more than 2020 average spend as one in four consumers expect to spend more this Christmas.

With 35% of people spending Christmas at home with extended family, an increase from the 29% last year, consumers have more opportunity for gifting, buying clothing for the event, and spending on festive food and drink. These are exactly the categories PWC expects a growth in, as well as leisure, experiences, stocking, cosmetics, sporting apparel, and electronics.

As previously mentioned, due to Covid-19, supply chain issues, and labour shortage, the retail sector is struggling to meet the demand. 62% of shoppers have said that they were unable to purchase at least one product due to shortage in the last three months. 39% of these shoppers reportedly switched brands, 32% went to a different retailer, while only 13% waiting for the item to be restocked. It is evident that consumers are willing to switch brands or retailers. Therefore, the challenge for retailers this holiday season is to earn and maintain customer loyalty.

Thus, retailers should use the key shopping dates as an opportunity to attract and delight customers with their brand and products. Having products that are in demand, and also being transparent about availability is important; it can help consumers save time, appreciate your brand more, and show loyalty.

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