As we enter the crucial final quarter for e-commerce, we’ve looked into the key questions online retailers are asking to help you prepare for what’s ahead.
Spend Indicators – Will UK Customers Spend More This Festive Season?
In July, Retail Week published its annual forecasts for the “Golden Quarter”. This year’s report acknowledges that we are operating in a volatile market, with ongoing conflicts and potential trade policy disruptions affecting supply chains and prices. However, there are reasons for cautious optimism, with predictions of improvement over the past two festive seasons.
Despite continued cost pressures, 2025 may see an increase in festive spending potential. Falling interest rates, a stronger labour market, and wage growth have enabled more households to build savings. The UK Consumer Confidence Barometer showed improvement through 2025, particularly for larger ticket items.
What Type of Gifts Will UK Consumers Be Buying for Christmas 2025?
Food and drink gifts are expected to rise sharply as consumers treat themselves and others, whilst managing higher everyday grocery costs. Premium hampers and specialty items are expected to perform particularly well. Our Flexi-Hex® packaging is great for food and drink items!
Toys and games remain dominant, predicted to make up around a third of UK spending, despite the threats of tariffs, supply chain challenges from China, and increased acceptance of second-hand gifting. Maybe it would be easier if they really were made in the North Pole!
Fashion has had a difficult year, with muted growth predicted. This year’s sales are likely to focus on investment pieces or practical items like winter coats, with consumers browsing early but purchasing later in the season when pricing and delivery speed become critical.
After strong sales last year, health and beauty will remain a popular category in 2025. Packaging, limited editions and special festive products are likely to be important differentiators. Electrical wellness products such as LED facemasks, sleep devices and grooming tools could also have a good year.
Homewares are set for growth as the quiet housing market drives “improve not move” behaviour. Tableware, accessories, textiles and other gifts that add a bit of sparkle to our homes, will be particularly popular.
Black Friday vs Boxing Day – When are Winter Sales Likely to be Most Effective?
Cost-conscious consumers will again wait for deals, whether through Black Friday (28th November), pre-Christmas sales, or Boxing Day discounts.
Black Friday will likely feature home appliances, beauty products, hair tools, and premium fashion items. However, experts predict retailers will focus on maintaining reasonable prices throughout the period rather than aggressive discounting.
Logistics Predictions – What are Customers Expecting in Terms of Delivery Speed and Cost?
Fast delivery and competitive costs remain crucial differentiators. Whilst Gen Z and Millennials often pay premiums for speed, older shoppers remain sensitive to delivery costs.
Last-minute fulfilment is increasingly important as shoppers delay decisions but still expect fast delivery. Last year many brands, including Boots, successfully added “instant delivery” using platforms like Deliveroo and UberEats alongside traditional couriers.
Younger shoppers may be very happy to order and collect in-store, if your location allows it.
Will AI Have an Impact on Christmas Shopping in 2025?
AI adoption has accelerated dramatically since December 2024. More consumers will use AI tools for initial Christmas shopping research, discovering products through AI overviews rather than direct website visits.
As a result, retail experts are predicting websites will see fewer visits this autumn, but higher conversion rates, as the traffic that does come to your site will be more qualified. Retailers should audit their AI presence, by checking how products appear in ChatGPT and other tools’ responses and monitoring AI-driven traffic.
AI is also enhancing personalised shopping, remarketing, dynamic pricing, inventory management and customer support, helping merchants increase both sales and loyalty.
Changing Demographics – How Will Gen Z Young Spenders Influence 2025 Retail?
Gen Z spenders, now in their mid-twenties, now represent a significant festive spending segment. As full digital natives, this group have very distinct preferences and require a seamless experience if they are to purchase from you online.
Social media influences 85% of this demographic’s shopping journey. Short-form video content, influencer collaborations, and paid advertising on Instagram and TikTok are essential for reaching these consumers, who often purchase directly through social platforms such as TikTok and Instagram Shop.
Flexible payment options, particularly “buy now, pay later” schemes like Klarna and Clearpay, are increasingly important for Gen Z and Millennial customers.
Sustainable Shopping – How Will Environmental Concerns Shape Gift Giving This Year?
Younger shoppers are not the only shoppers who are increasingly aware of the environmental impact of their purchases, with concerns around packaging waste, single-use cardboard, plastic bubble wrap and other non-sustainable protective packaging. Over half of UK consumers now prefer brands that promote sustainability as part of their brand values.
With an eye on both sustainability and budget, pre-owned items are gaining acceptability as gifts, with platforms like Vinted gaining momentum and brands including Finisterre and FatFace launching pre-loved departments.
How Can Forms Plus Help?
With over 45 years’ experience supporting sellers through the festive period, Forms Plus are ready to help you manage the busy months ahead. Whether you need advice on eco-friendly packaging, support choosing integrated labels, are interested in customising your packaging or would like to order samples of any of our products, do get in touch.