Less is more this December as consumers tighten the festive season purse strings

“Consumers are determined to spoil themselves and their loved ones, but are also grappling with making the most of tight budgets. Most have adopted tactics such as shopping early and taking advantage of special offers,” says NielsenIQ managing director Ged Nooy.

Nooy notes that last year, a quarter of all rands spent were on promotions during the peak festive season shopping week ending 26 December.

“Significantly, this is 3 percentage points lower than the average for the previous year, and a whopping half of that seen on Black Friday week in the previous month of November 2021. This suggests that retailers and manufacturers pulled back significantly due to their investments in Black Friday,” he says.

The latest NielsenIQ State of the Retail Nation review, which reflects data measured over the four weeks to the end of October 2022, shows that certain long-forgotten consumer behaviours, such as shopping around at different retailers, have started to resume as Covid fears retreat. 

These include more frequent shopping trips and bigger baskets. Shoppers have increased the number of products they purchase per shopping trip as the interval between trips has become longer. NielsenIQ data show that, in some instances, consumers have upsized to buy in bulk, downsized or exited a product category completely due to budget constraints. 

The rise of convenience continues, but not only in the form of rapid delivery and quick e-commerce options. Locality is increasingly important, with independent retailers that have a large footprint and a decentralised offering seeing a significant increase in feet through the door versus the usual superstores.