Brands are being warned to prepare for the most frugal Christmas in living memory as the cost-of-living crisis squeezes people’s spending power.
The latest Reality Check report from advertising agency Mindshare asked over a thousand UK adults from all walks of life how they were feeling about Christmas.
Just a quarter of those asked said they were feeling positive about the festive season – down almost 25% on the same time last year. Meanwhile, the number of people feeling very negative about Christmas (14%) was almost five times higher than this time last year.
For many respondents, this negativity is directly linked to the cost-of-living crisis. Four in 10 said they were worried about affording Christmas, while three in 10 expected to rely on credit cards more than in previous years. 35-54 year-olds are the age group most likely to be concerned, with over half worried about covering the cost of the festive season.
Despite these worries, people appeared keen to make sure their loved ones enjoy Christmas, even if it means making sacrifices themselves. Two-thirds (67%) said they wouldn’t be asking for much this Christmas, 59% want to make sure their kids don’t miss out, while over half (56%) predict they will be spending on loved ones rather than themselves.
Meanwhile, when asked where their focus will be this Christmas, 78% said they would prioritise saving over splurging, 79% predicted they will be staying in rather than going out, and 74% said they will be holding back rather than indulging.
“This Christmas is quite different to anything advertisers will have experienced before,” said Julia Ayling, Head of Research & Insights, Mindshare UK.
“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.”
However, she noted that there were still reasons to be optimistic for brands that manage to resonate with the public over the festive season.
“The ‘squeezed middle’ are making changes to make sure their loved ones can still enjoy,” said Ayling.
“This group needs support from brands to spread the 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.”
