Deloitte Retail Holiday Report 2024: Holiday shoppers to tighten purse strings as cost-of-living challenges bite
Australians battling an ongoing cost-of-living crisis are planning to slash their spending by almost 20% this holiday season, prompting retailers to find ways to offer more value as they look towards a more positive 2025.
According to the 13th edition of Deloitte’s annual Retail Holiday Report report, pre-Christmas competition for consumer wallets is already heating up, with businesses strongly focused on a time of year that can be make or break for so many.
The report assesses retailer sentiment towards the all-important holiday trading period, identifies key sector trends into 2025 – and, for the first time, has surveyed 1,000 consumers on their spending intentions and shopping expectations.
Key retailer findings:
- Only 51% of retailers expect sales growth, down from 57% in 2023 and 67% in 2022
- 40% believe consumers won’t pay full price
- 41% now anticipate an improvement in consumer confidence over the next 12 months, up from just 10% in 2023.
Key consumer findings:
- 76% are cutting back on spending overall, but 67% are still looking to make small splurges
- 48% expect to buy fewer goods and services
- 95% are seeking the best deals as their first priority
- 32% would walk away without some sort of discount.
Deloitte Consumer Products & Retail Sector Leader Elise Sharpley said: “The last 12 months have brought little joy for our retailers, as inflation, interest rate rises and weak demand have weighed on economic growth.
“Cost of living pressures and the associated belt tightening are driving consumer spending intentions and actions, and this is set to continue into the 2024 holiday retail season.
“On the back of real retail turnover per capita not growing since mid-2022, consumers are planning to spend $1,002 on average this year, down 18.9% from 2023. Retailers will be working hard to entice these consumers to open their wallets as the silly season heats up.
“Against this backdrop, consumers are changing the way they shop, how much they purchase and the type of products they buy, so we’re looking at a more frugal holiday period ahead.”
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