Consumers set to shun credit this Christmas
The majority of consumers (77 per cent) have said they will turn their back on credit this year and instead use their salaries to pay for Christmas 2014, according to research commissioned by Callcredit Information Group.
Only 10 per cent of consumers confirmed they will use credit, a stark contrast from historical research conducted in 2013 when 30 per cent said they would fund their Christmas spending through additional forms of credit*.
The independent research undertaken by YouGov** asked consumers how they intended to finance their Christmas spending for 2014, will they be spending more or less and how will they divide their Christmas shopping between in-store and online. The findings were then further enhanced by Callcredit’s new CAMEO UK segmentation tool showing how these views differ across socio-economic groups.
By using CAMEO UK Callcredit was able to categorise respondents into ten different groups ranging from ‘Business Elite’ to ‘Family Value’.
When asked how will you be financing your Christmas shopping this year?
- The least affluent groups have the most uncertainty of how they will finance Christmas, with 20 per cent of the “Family Value” group saying they did not know, compared to just 9 per cent of the “Business Elite”
When asked do you think you will spend more, less or about the same amount on your Christmas shopping compared to last year?
- The majority of consumers across all segments were in agreement that they would spend around the same or less than last year. Interestingly the segment most likely to spend more was those “On a Budget” (14 per cent), with the least likely to increase their spending being the “Prosperous Professionals” (2 per cent)
When asked: Thinking about your Christmas shopping, how do you typically divide your spending between in-store and online?
- 50 per cent of consumers confirmed they will complete at least half of their shopping online with the most affluent and younger segments having greater focus on shopping in this way. 63 per cent of 25-39 year olds do their Christmas shopping online compared to 40 per cent of the 60+ age group, where time pressures may be less
Zoe Palethrope, Head of Products and Propositions at Callcredit, commented “For the vast majority of retailers Christmas is an extremely busy time of year and one that can either make or break a business. As we now approach the middle of November many people are thinking ahead to December, either continuing with or starting their Christmas shopping. Our research shows there has been a clear change in customer attitudes, not only in the way they will fund their spending but also how much they will spend, over half of all consumers say they will spend roughly the same as last year, suggesting that consumer confidence remains low and many will approach the festive season with caution.
Zoe concluded “While it’s widely agreed that consumers no longer solely shop through one channel, the research highlights a more equal combination of online and in-store to satisfy their needs. It’s therefore vital that retailers ensure that the experience between online and offline is seamless in order to maximise sales. By understanding how much their customers are going to be spending and through what channel, it’s possible to tailor the products and services more accurately”
* Figures from OpinionMatters 2013
**All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,739 adults. Fieldwork was undertaken between 5th – 6th October 2014. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).
