Christmas spending is set to hit record highs of £91.12bn this year as consumers splash out on their festive shopping despite the stubbornly high inflation rates and cost of living concerns.
New research from VoucherCodes.co.uk’s Shopping for Christmas Report 2025 forecasts a 3.2% rise in sales across the six week festive period (from mid-November to end of December) with gifts, food & drink and holiday travel expected to receive the most.
Whilst retail sales are set to an uplift versus previous years, sales volume is forecast to decrease by 0.3% for the first time since 2023 as consumers remain cautious over festive spending.
Total retail sales by European nation. 2022 actuals, 2025 forecast.
Sales (£ billions) | Growth YoY (%) | ||||
2022 | 2023 | 2024 | 2025 | 2025 | |
United Kingdom | £82.20 | £84.90 | £88.29 | £91.12 | 3.2% |
Germany | £73.27 | £73.74 | £73.05 | £74.78 | 2.4% |
France | £62.48 | £62.83 | £62.15 | £62.86 | 1.1% |
Italy | £37.44 | £37.93 | £37.45 | £37.75 | 0.8% |
Spain | £24.91 | £25.90 | £25.87 | £26.86 | 3.8% |
Netherlands | £12.87 | £12.90 | £12.88 | £13.27 | 3.0% |
Belgium | £9.66 | £9.72 | £9.63 | £9.81 | 1.9% |
In terms of retail sales, the UK is set to outperform all other major European countries with the total spend £16.34bn higher than Germany’s, the second highest performing nation (£74.78bn). But, when looking into the growth rate, Spain is expected to take the lead with sales up 3.8% YoY – just exceeding the UK’s 3.2% growth rate. Germany (2.4% YoY) and the Netherlands (3.0% YoY) are also set to see a large boost in festive sales.
Spending by category
This year UK consumers are expected to spend the most on Christmas gifts, with £11.59bn set to be spent on presents alone (+2.1% YoY) – that equates to an average of £443 per household and 50.5% of all Christmas sales. It’s no surprise toys are topping the list of most popular gifts (£2.13bn) followed closely by electronics (£2.03bn).
Whilst food and drink spend is expected to be lower (£8.36bn), it’s the category set to see the highest growth rate, up 3.6% YoY. Holiday travel is also expected to do well this year, accounting for £2.36bn of all sales across the festive season as Brits brave traffic jams to spend Christmas with their loved ones.
Yet again, decorations are forecast to see the lowest retail sales, accounting for £0.63bn of total retail sales. However, in good news, the category is set to see its first growth since 2021- albeit only 0.3%.
Online vs. offline spend
As online shopping becomes increasingly popular across the nation, this year both online (+4.7%) and offline sales (+2.3%) are forecast to see growth year-on-year. In fact, online growth is expected to see double the growth of offline shopping.
Despite online shopping’s impressive growth, almost two thirds of all Christmas retail spend will take place in stores (62.7%), accounting for a staggering £57.1bn of total spending across the festive period. With almost half of UK consumers planning to make a festive purchase in a supermarket (48%) and a further 40% heading to the high street, brick-and-mortar retailers can look forward to a merry Christmas. On the other hand, online sales are expected to total £34.0bn.
Moji Oshisanya, chief commercial officer at VoucherCodes.co.uk, comments: “It’s looking like another sparkling Christmas for retailers this year. All categories are expected to see uplifts in sales across the festive period, with consumers determined to not let budgets put a dampener on celebrating the festive season in style.
“However, with inflation at such a high level, UK consumers are increasingly on the hunt for ways to help their money go further. With one-fifth of consumers actively looking for discount codes to boost their Christmas budgets (22%), retailers should be prepared to offer savings and limited time offers to encourage this money-savvy audience to spend with them instead of with competitors. When budgets are tight, value is all important.”
