The bosses of Britain’s biggest retailers are feeling positive about Christmas this year as early trading shows shoppers are starting to feel more confident about spending in the wake of easing inflation.
M&S CEO Stuart Machin says the retailer is “very confident” about trading this year, while Tesco chief executive Ken Murphy says he’s “betting on a good Christmas” as customers display “a willingness to spend a little bit more to treat themselves”.
That positivity is shared in the department stores sector with Fortnum’s boss Tom Athron feeling “excited” about the upcoming season and John Lewis enjoying an earlier start to its Christmas sales.
Forecasts add credence to this positivity with VoucherCodes.co.uk predicting a 4% boost in sales this festive season to £88.3bn. Whilst this rise comes partly from inflation, it is also driven by a 1.4% rise in sales volume year-on-year.
However, the cost-of-living crisis and aftermath of the Budget still looms large. The Works CEO Gavin Peck warns that consumer confidence still remains “fragile” and that many will continue to shop “much later than usual in the run up to Christmas” or look to spread the cost.
Asda chair Lord Rose is also feeling somewhat cautious as he notes “the country’s had a tough year and we’ve had a change of government”.
“I hope now that they’ve heard the worst news about the Budget, people will want to have a time where they get together with their families and let’s hope that we see some growth in the economy. We’ve got to be positive.”
Retail Gazette takes a look at how retailers will fare across a host of sectors, from fashion to food and toys to electricals, as 25 December nears.
Fashion
M&S’ Machin has good reason to feeling chipper this festive season.
“Our customers are anticipating they’re going to spend more this Christmas than last year,” he says.
M&S is going all out for party season. Machin says the retailer’s “most stylish seasonal clothing offer yet”, which includes sequin tops, mini skirts and capes, is performing well already.
Asos CEO José Antonio Ramos Calamonte says that the market is still “really volatile” although he adds that “things are a bit better in terms of consumer confidence” in recent months, especially in September when the colder weather hit.
However, budgets are still squeezed and some shoppers are trading down, according to the online boss.
“We have seen some consumers trading down to lower price points, which doesn’t really mean we have been reducing prices. It’s been that they have been focusing on lower price points.”
Matalan director of product development Laura Wiard says shoppers “are planning to spread out their spending and find great value in Black Friday offers”.
The fashion and home retailer launched its ‘Christmas at Matalan’ offer in store at the end of September and its online shop two weeks earlier than last year, responding to customer demand that kicked off in August.
In terms of product trends, Calamonte says that burgundy clothing is “incredibly strong” for Asos, and predicts that 80s designs and embellishment will be big this Christmas. In menswear, he believes the “preppy, varsity look” will be “very, very strong”.
Wiard notes customers “have been loving novelty products this year” and she expects this to continue through the golden quarter.
“We’ve got plenty of novelty Christmas products to meet this demand – whether it’s our traditional winter knits, bold festive family PJs, or quirky, colourful decorations.
2024’s hottest shoe trend – the Adidas Samba – will continue to drive sales at sports retailers over the festive period.
A spokesperson for JD Sports noted the retailer’s “terrace and retro running styles have been particularly in demand this year and we see this continuing into the Christmas period”.
“Our premium athleisure collections have also proven popular in offering head-to-toe styles for all season,” they added.
Beauty
Both Boots and Superdrug are anticipating a bumper Black Friday (29 November) this year as customers look to spread the cost of Christmas.
Boots, which has over 22,000 promotions running this month, experienced “extremely high demand” which caused it website and app to crash when its Black Friday sale went live.
Superdrug is also placing a greater emphasis on its Black Friday sale this year, offering customers up to 70% off across more than 400 products.
The health and beauty chain’s chief commercial officer Simon Comins says: “Over recent years we have seen people shop earlier and earlier for Christmas.
“The cost-of-living crisis meant that shoppers were having to plan their Christmas spend and spread the cost over the months leading up to Christmas.”
“We expect the peak [trading] to be around Black Friday weekend but think sales will be consistent in the months leading up to Christmas, as people will look to spread the cost again this year.”
The retailer is expecting a flight to value. Comins says: “We expect our own-brand gifting range to feature heavily amongst our bestsellers this year, as consumers look for great quality gifts at great value.”
He also predicts that, on the back of social media trends, electrical healthcare tools will fare well, particularly its water flosser, which sold out last year.
“We have expectations that it will sell really well again this Christmas, so have released exciting new colourways,” Comins says.
Grocery
Tesco boss Ken Murphy says the grocery giant is “betting on a good Christmas” as customers begin to trade up and sales of its premium ranges soaring almost 15% in its first half.
He explains: “We track customer sentiment every week and while they’re not doing cartwheels down the hallways, they are in really good shape.
“You’re seeing a stability in customer sentiment from a grocery point of view, and also a willingness to spend a little bit more to treat themselves, and you see that reflected in our Finest sales growth.”
Similarly, Sainsbury’s boss Simon Roberts is also confident the supermarket chain will deliver another strong Christmas. 
“What we’ve seen over the last three or four years through the pandemic and the inflation crisis, Christmas has been a time when people in the end want to be together with their friends and family and loved ones.
“There’s absolutely no complacency at all in our business. We’ve had three strong Christmases and we’re preparing for a fourth one to come.”
According to Sainsbury’s, convenience will be a big trend this year as only 21% of shoppers plan to cook everything from scratch on the big day.
Shoppers are also planning ahead with M&S seeing more of its shoppers pre-ordering products this year.
“Our Christmas food to order products sold faster than they’ve done in any other previous year,” notes Machin.
“I think we’re in a very, very good place. So we’re excited. We want to get ahead of the volume curve,” he adds.
Aldi explains shoppers want to experience “a little bit more extravagance” over the festive period, insisting its premium tier of luxury Specially Selected products provides them with “high quality, while also offering a significant saving against the equivalent products available at other more expensive retailers”.
The discounter also points out that shoppers are looking “more and more to spread the cost of Christmas,” and that it has been selling key frozen products including party food and frozen turkey from September onwards “to meet this demand”.
Department stores
Department stores are anticipating a sparkling golden quarter this year.
John Lewis boss Peter Ruis says “we expect to be fully up and running for Christmas with the biggest and best offer ever”.
The department store’s customer director Charlotte Lock says the department store is still riding high from the relaunch of Never Knowingly Undersold, which has given it “great momentum” coming into the golden period, with sales up 6% in September.
“We’re not we’re certainly not taking anything for granted, but we’re feeling very positive…We’ve invested more in Christmas than we ever have. Our Christmas shop is up 18% year on year.
“We’ve definitely still heard from customers that there is caution around spending on big ticket,” Lock adds. “It’s a very tough environment. We think that people are definitely waiting for deals. We’ve got all of the trade marketing plans to support that but we’re feeling cautiously optimistic.”
Fortnum & Mason boss Tom Athron says he’s feeling “excited” about this Christmas as consumers start to loosen their purse strings amid easing inflation.
Athron notes: “Compared to last year, when the peak of Christmas came very late, we are pleased to see that customers are shopping a little earlier and we have seen a strong start to the festive season.”
“Whilst the world feels like a challenging place presently, particularly economically, politically and internationally, we find that during tougher times our customers still come to Fortnum’s to seek small moments of joy for themselves and others.”
However, customers are likely to think much harder about where they spend their money this year. “We expect that many who shop with Fortnum’s will come to us for beautifully crafted items to gift their loved ones, though may shy away from the big-ticket items.
Athron is also expecting to see a rise in customers buying experiences over the quarter, such as “tickets to concerts or the theatre, or, here at Fortnum’s, tickets to supper clubs or a masterclass in our Food & Drink Studio”.
Homewares
Shoppers have started making their homes feel festive earlier this year. John Lewis’ Christmas Shop is already a hive of activity, with sales of decorations up 20% year on year. 
Single bauble sales are up 40%, with its playful Battenberg cake, Quality Street tin, and disco ball cherries proving popular.
It’s a similar story at online department store Very.
Chief customer officer Jessica Myers says: “Our customers have already started buying items from our Christmas range, with more than 4,000 Christmas trees having already been bought.”
The Cotswold Company chief executive Ralph Tucker is feeling “quietly optimistic” and expects it to be a “good Christmas” for the retailer.
He cites positive macro indicators such as easy inflation and growing consumer sentiment, and expects its stores to prove popular.
“We expect our showrooms, including new locations in Bath and Stamford, to be really popular for last-minute accessories and gifts.”
“We are seeing customers making more considered purchases. Through our analysis of our Instagram, Facebook and Pinterest channels, we can see customers are planning their purchases more than ever.”
Gifts
Card Factory boss Darcy Willson-Rymer is conscious there will be greater diversity in budgets this year of people looking to celebrate the holiday.
“We’ve done quite a lot of work on range development so you’ll see some new card designs, new gifting ideas and also a lot more personalisation.”
“If you have a very modest Christmas budget, that’s okay, come to Card Factory, we can help you celebrate Christmas. If you’re feeling that you’ve got a little bit more to spend, then we have a breadth of range that balances out that quality and value.”
The Works chief executive Gavin Peck adds that while consumer confidence remains “fragile”, there will be a greater emphasis on value over the coming months.
“Consumers have shopped much later than usual in the run up to Christmas over the last couple of years, demonstrating their cautious approach to spending.
“We have seen this with other seasonal events this year, such as Back to School, and therefore expect a similar approach to Christmas this year.”
The retailer is seeing strong demand in its 2 for £12 and 3 for £15 gifting ranges, with hobby horses and remote-control cars proving particularly popular.
Peck notes that BookTok has become “a big driver of sales across the book industry”.
“It’s incredible to see how quickly a title can go viral through this channel and we’re always on the lookout to see what the next trending title will be. We expect this to continue at Christmas.”
He predicts Boris Johnson’s somewhat controversial autobiography Unleashed is likely to capture attention ahead of the holiday period.
Toys
Those buying toys are getting ahead of the game this Christmas, in part, to spread the cost.
Very’s Myers says: “Almost two thirds of customers say they buy gifts for children first, with our sales for toys increasing by 67%, on average, in October when compared to September.”
The Entertainer head of buying Steven Pearson says: “Within our top toys for Christmas list, we have tried to curate products with a wide range of price points that will benefit all but would always advise our shoppers to check our website for even better prices and deals as we head towards Christmas.”
Film related are also predicted be a big trend this year due to the release of sequels of Sonic the Hedgehog, Moana, and Paddington. according to Pearson.
The Entertainer is also seeing strong sales of “heritage” licensed toys such as Hot Wheels, Star Wars, Transformers, Spiderman, Marvel, Littlest Pet Shop, Peppa Pig and Paw Patrol.
But toys aren’t just for kids. Hamleys senior buyer Karen Dennett says “kidult” toys is a trend which has been “growing and growing” for the last five years, and that’s “not showing any signs of slowing down”.
The toy store is feeling “very positive this year” with the Moana Singing Doll and Hamleys Huggables Plush Selection expected to fly off the shelves, Dennett shares.
She adds: “It’s going to be a good Christmas”.
Electricals
Currys believes AI technology and retro products will dominate the bestseller list this year.
The retailer’s chief commercial officer Ed Connolly says the arrival of AI will be a “significant driver of consumer upgrades, especially in computing and mobile categories, as Microsoft, Apple, Google, Samsung and other generative AI tools arrive on new devices”.
He adds that its partnership with Microsoft on the rollout of Copilot and Copilot+ PCs helped drive its share of the UK Windows laptop market to almost 50%.
Connolly notes that retro products are also performing well at Currys.
“Sales of Polaroid cameras are up 110% between January and August, as well as increased sales of digital point-and-shoot options.
“We have seen sales spikes of 24% year on year for record players between April and August.”
The trend is set to continue over the festive period, with Oasis’ LP albums set to be a bestseller following news in August the Gallagher brothers were reuniting for a host of summer tour dates next year.
Meanwhile, kitchen appliances will be a big trend over the golden quarter for AO.com, particularly coffee machines and air fryers, according to Nick Small, the retailer’s head of category for small domestic appliances.
“Air fryer sales are still strong, and we envisage they will be a big seller again this year while rice cookers could also be another appliance to look out for,” he says.
Small expects shoppers to start looking early for bigger gifts and use the Black Friday sale to “grab a deal early”.
The shopping event is set to be bigger this year, with PwC predicting sales to soar 37% to £7.1bn, helped by actual Black Friday falling after pay day this year.
According to PwC’s Black Friday research, tech will be the top spending category with almost half (49%) expected to make a purchase, followed by fashion (38%), and health & beauty (28%).
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