Expect Christmas spending in the UK to be strong this year, reversing years of festive cutbacks.

And with a 4% year-on-year rise in related spending expected, UK retail looks the only place to be this Christmas, at least compared to five European countries where a decline in spending’s expected (Germany and Belgium -0.9%, France -1.1%, Italy, -1.3%, Spain and the Netherlands, -0.1%).

Those are the good-news findings from VoucherCodes.co.uk’s ‘Shopping for Christmas’ report. However, before we get too excited, that 4% UK rise is spread across gifts, food, drink, and festive travel spending, and it’s also worth noting that the rise is partly due to inflation aside from the smaller 1.4% uplift in sales volume year-on-year.

Gifting will see the highest total spend, accounting for £11.35 billion of sales — a 0.8% year-on-year rise on the £11.25 billion spent last year. 

The report also shows both online and offline sales are set to grow this year, with physical store sales hitting £55.81 billion, up 3.4%, and online sales growing at an even faster rate to £32.48 billion (+5.1%).
 
Michael Brandy, Senior Commercial Director at VoucherCodes, said: “It’s set to be a very Merry Christmas for retailers this year. Almost all areas of retail are forecast to see uplifts over the… period, consumers are finally willing and able to splurge and treat themselves and their family to a big festive celebration.” 
 
He added: “Although consumers have more money in their bank accounts to spend… they’re still looking for ways to stretch their budget. After two years of a cost-of-living crisis, consumers are much more financially savvy and know when they see a good deal. To convince them to part with their hard-earned cash, retailers will have to offer genuine value and should consider deals and discounts as a way to entice customers to spend.”