Holiday Shopping Bargains: How To Save Money This Christmas

Last year, Zahra notes, Christmas spending was bolstered by a surge in “freedom spending” with many consumers staying put in Australia, due to lingering pandemic restrictions and airlines yet to restore flight schedules to full capacity.

This year, however, many more Australians will be travelling both domestically and internationally due to airlines offering more flights. As a result, Australians are expected to be “much more conservative with their shopping budget given the current cost-of-living pressures,” Zahra said.

Provisional forecasts by the ARA, in conjunction with Roy Morgan, predicts $66.8 billion will be spent in the November to December 24 Christmas trading period—broadly in line with last year (up slightly by 0.1% or $74,000)

Zahra explains that this preliminary projection is subject to monetary tightening decisions by the RBA and Australian Bureau of Statistics retail trade data in the months leading up to Christmas, meaning it could change depending on the RBA’s decisions and the ABS data.

In terms of categories, food spending is tipped to encompass the lion’s share of spending, making up $26.7 billion of the overall spend, Zahra says. Compared to 2022, spending on food is projected to increase 2.4%, mainly driven by supply-input price increases. In fact, research from Afterpay found one in five (20%) say they spend more on Christmas lunch than any other month of the year.

The categories of hospitality (down 4.2%), household goods (down 3.2%) and clothing (down 0.8%) are expected to soften in the lead-up to Christmas, as cost-of-living pressures continue to bite and the RBA’s 13th rate hike works its way through the economy.

However, department stores (up 2.9%) and other retailing (up 1.7%)—which includes categories such as recreational goods, books, and cosmetics—are poised to record sales growth compared with last year.

Despite an expected softening in the broader pre-Christmas spending period, the popularity of Black Friday is set to continue, giving retailers a much-needed boost to the holiday shopping season.

Black Friday falls on Friday November 24, with Cyber Monday following on November 27.

“It really started off as an American shopping tradition, but the Black Friday sales have become a global phenomenon and millions of Aussies will undoubtedly take part this year,” Zahra said.

“We’re expecting a $6.36 billion [spend] across the four-day Black Friday and Cyber Monday (BFCM) weekend—up 3% from last year—with shoppers increasingly on the hunt to find the best deals.”

In fact, in recent years, upwards of a quarter of Christmas shopping is completed in Black Friday week alone and that trend is expected to continue this year, Zahra says.

However, Afterpay found that some Aussies take a different approach:  25% of those surveyed said they didn’t start their Christmas shopping until December, with one in ten leaving their gift shopping until the week of Christmas—something Zahra advises against in order to get the best deals.

Other data shows quite the opposite: a Shopify outage on November 13 was caused due to excessive shopping by Australians nice and early; even before some BFCM sales had begun.

Nat’v Basics Founder Sandy Ronalds said they did launch their BFCM campaign yesterday, with more than five figures in sales achieved in the first hour of the sale going live. Meanwhile, Bangn Body Founder Priscilla Hajiantoni said that while their sale doesn’t start until later in the week, they have already sold 80% of their stock: the biggest week to date in history since the company’s 2019 launch.

Due to the cost-of-living crisis and 13 interest rate rises over the past 18 months, consumers will be looking for more bang for their buck, Zahra says.

“Value-based shopping will be a priority [as] any Australians will actively seek out the best deals and look for value purchases.”

Zahra believes a major focus this year will be practical gifts that “kill two birds with one stone”.

As an example, this could be an item for a child that is already on their necessary back-to-school list, such as a new backpack or lunchbox.

“Ultimately, shoppers will be compelled to shop for friends and loved ones but will want to feel like they’re getting a good deal,” Zahra says.

There is also an increasing trend towards sustainable products with customers seeking out purchases that align with their ethics and values, Zahra notes.

“Customers are looking for products that are eco-friendly, have minimal environmental impact, and are produced using sustainable practices.”

Matt Holme, CEO and founder of YouPay, is a big fan of shopping intentionally.

“Shopping with purpose and getting gifts you know your friends and family will love eliminates the wastage in gifting as people are getting the gifts they actually desire; [rather than] some random items that have potentially been bought last minute on Christmas eve in a panic.”

The balance between finding ethical and sustainable gifts, while keeping costs down, is the challenge Australians will face this holiday season.

Retailers will be playing their part too in enticing the budget-conscious shopper–especially as competition increases and spending reduces across discretionary categories.

“Expect retailers to be running more promotions, investing heavily in Black Friday and (feature) gift solutions at keen price points,” Zahra says.

“It’s ultimately a win for consumers, with retailers likely to ramp up sales events and promotions in a bid to stimulate spending.

“Of course, there is also customers that are not impacted by the current economic conditions, and they will continue to spend—so we expect luxury sales to be (largely) unaffected.”

It’s all well and good to know how much money Australians are set to spend, but how can you actually save on your Christmas shop? Here’s a list of tips from the ARA and YouPay founder and CEO, Matt Holme.

1. Shop early: ARA continues to see consumers shopping earlier each year, often taking advantage of early retail promotions to start their Christmas shopping list. With the changing consumer habits this year, it makes Black Friday and Cyber Monday even more important.
2. Plan ahead: Planning is key to avoid disappointment and to take advantage of the best value opportunities. Research and order ahead for any critical items—particularly fresh food items for Christmas meals.
3. Ask for wish lists: By empowering all of your family and friends to use wish lists or voice what they would love to receive, people will get gifts they actually want and are also able to make a conscious decision on how much (or how little) their friends and family spend on them this year.
4. Use click and collect: Click and collect is offered by most large retailers, and helps you to avoid long queues and busy shopping centres. It can also help you budget if you are shopping online, rather than being surprised at the total cost once reaching the till.
5. Check delivery times: This will ensure that items purchased online will reach you or the gift recipient before the big day, so you won’t have to pay extra for express delivery. The holiday season is the busiest part of the year for postal carriers, so delays are to be expected when compared to regular delivery times. Last year, Australia Post delivered over 52 million parcels pre-Christmas.
6. Note extended shopping hours: Many retailers and large shopping centres have extended shopping hours—research those near you and avoid peak times to avoid queues, and even potentially find some end-of-day bargains.
7. Take advantage of electronically sent gifts: Gift cards, purchased and sent electronically, are a great last-minute option and can avoid postal delays. Gift cards are the most sustainable gift as the receiver gets to choose exactly what they want and may prevents an unnecessary addition to landfill.

It’s not just pre-Christmas shopping that is home to bargains, but post-Christmas too. Boxing Day sales have long been a popular occurrence, with many flocking to the shops to snap up some post-Christmas deals.

It’s also become a more recent tradition for retailers to offer new year sales as well, with many retailers discounting their products at the beginning of the calendar year.

No matter when you chase your bargains, Zahra says it’s important to remember that many retailers remain short staffed due to labour shortages and are doing their  best–both pre and post-Christmas.

“Patience and courtesy are always encouraged especially during this chaotic time of the year.”