If you were banking on Christmas gift sales to get you through a tough winter, you may want to fine-tune your strategy as the cost-of-living crisis intensifies and the UK prepares for another recession.
According to a new report from Astound Commerce, lowest price will be the number one factor of consideration for shoppers when choosing which retailers to spend with this festive season. This is followed by quality and selection of products, convenience options, brand loyalty, brand values and supporting local businesses.
Last year shoppers placed brand loyalty as the most important factor influencing their buying decisions. However, with rising energy and food bills dampening consumer confidence and lowering disposable income, cost and value is set to be key this Christmas.
In a survey of 1,000 global shoppers, more consumers said they will spend less on purchasing gifts this season (33 per cent) compared to last year (15 per cent). When asked what factors would determine which retailers consumers shop with, UK and European respondents prioritised lower costs (1), quality and selection of products (2) and convenience options (3). Among those polled, aligning brand values and supporting small businesses fell in importance from 3 to 5 and 4 to 6 respectively.
When it comes to shopping online, speed of delivery (73 per cent), free returns (73 per cent) and a flexible returns policy (72 per cent) top UK and European consumers list of the most-desired on-site features.
“With consumers’ cost of living increasing, the battle for share of wallet will inevitably intensify,” says Astound Commerce UK’s MD Samuel Cane. “Brands should look to make transacting as easy and seamless as possible, inspiring confidence in the consumer that they are making the right choice. Experience is everything—now more than ever.
“Acquiring new customers will likely be challenging in Q4, so marginal returns due to excess discounting to win shoppers on price simply aren’t worth it—and brand price matching strategies can essentially equalise all prices anyway. Instead, retailers must win shoppers on brand value, staying true to who they are and competitive based on their differentiators and the consistent, high-quality shopping and customer service experiences consumers expect.”
Read the full report here.