But in the last few years this rate of decline shows signs of slowing down for Christmas 2012, according to Deloitte’s annual consumer survey of Christmas spending.
Deloitte’s survey finds that for the third year running, Irish consumers plan to spend less this Festive Season and it predicts that on average, they’ll spend 1.7 per cent less this Christmas. Last year, Irish consumers indicated that they would spend 7.44 per cent less. In 2010, there was a 10.6 per cent reduction planned in spending.
While Irish consumers indicate that they intend to spend 1.3 per cent less on food and drink they anticipate a very marginal increase in spending on socialising (up 0.3 per cent). Across Europe, consumers have indicated that overall they’re likely to spend 0.8 per cent less this Christmas.
The survey, carried out in the second and third week in September, predicts that the average spend per household in Ireland will be €965.80 (with €288.30 spent on food and drink and €177.90 on socialising). The average household spend in Europe is €590.90.
While Irish consumers indicate that their overall spend will fall slightly, the survey indicates that they’re less pessimistic than in 2011 in terms of the overall state of the economy. However sentiment with regard to spending power is mixed – 30 per cent of respondents believe that their spending power in 2013 will deteriorate, 28 per cent believe it will stay the same and 22 per cent believe it will improve.
Richard Howard, a Partner with Deloitte, commented, “Consumers in Ireland are slowly becoming less pessimistic and this is positive to observe given the importance that consumer sentiment and spending is to the overall economy. In addition, it’s clear that Irish consumers’ desire to celebrate the festivities remains extremely strong!
“However, the measured approach to spending this Festive Season remains and saving and budgeting remain a key focus for Irish consumers. In fact, while over half of Irish consumers indicated that – similar to last year – they will prepare a budget, a further 27 per cent plan to budget more this year.”
In 2012, Irish consumers plan making fewer purchases on credit. Over half plan on reducing their exposure to loans from family, specialised consumer credit lenders and credit from retailers this Festive Season. And 42 per cent of consumers plan to use savings for a larger proportion of their purchases than in 2011.
As in previous years, those Irish consumers indicating they’ll spend more over the Festive period put the main reason for doing so as being to enjoy themselves and avoid thinking about the economic situation.
This is the 11th year Ireland has participated in the Deloitte Annual Christmas Spending survey.