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Rise in disposable income helps lift festive spirits

November 21, 2023 02:15pm
Rise in disposable income helps lift festive spirits image
Rise in disposable income helps lift festive spirits image

Rise in disposable income helps lift festive spirits

The latest consumer insight from Asda reveals that shoppers are feeling more optimistic about the festive season as the financial pressures facing UK households eases.

The supermarket’s latest Income Tracker reveals that average household disposable income increased by 12% year-on-year in October, the fastest rate of growth in more than two years.

In tangible terms, the average UK household was £23.04 per week better off in October compared to a year earlier. Notably, this marks the first time in more than two years that all households had some disposable income left at the end of the month after paying bills and essentials.

The rise in household disposable income stems from continued annual wage growth and a sharp deceleration in inflation, driven predominantly by notable falls in gas and electricity prices compared to the previous year.

The improvement in household finances has been accompanied by an increase in consumer optimism about Christmas. More than a quarter (27%) of consumers who took part in Asda’s latest consumer survey said they were excited about Christmas, compared to just 18% last year.

Despite increased excitement about Christmas, many shoppers are wary of buying festive gifts yet because they believe better deals will be on offer closer to Christmas. This time last year 40% of shoppers had already started their festive shopping, whereas this year just 30% have begun gift hunting.

With less than five weeks until Christmas, Asda’s Christmas preparations are in full swing. The supermarket has launched 275 new festive lines, several of which have scooped prestigious quality awards in the Good Housekeeping and BBC Good Food taste tests.

The supermarket is also focussed on making Christmas affordable for all customers and has launched a frozen Christmas dinner for six that costs £25. This works out at £4.17 per head and all the products featured are cheaper than last year by an average of 8%.

To provide an extra festive spending boost, Asda is giving more than a million customers who use its Asda Reward app a cash bonus of up to £5 later this month for saving money in their Christmas Saver Cashpots.

Asda is also offering people aged 60 and over the chance to enjoy soup, a roll and unlimited tea and coffees for just £1 in any of Asda’s 205 cafes until the end of February.

The retailer first launched Winter Warmers in November 2022 for two months in a bid to support older customers who were disproportionately affected by the spiralling living costs and has since served over 650,000 £1 soup meals.

About the Income Tracker

Independently compiled by Cebr (Centre for Economics & Business Research), the Asda Income Tracker has become an established barometer of disposable income, indicating how much families have left in their pockets after all taxes and essential bills are paid.

‘The Score’ is a weekly survey of 2,000 UK consumers, tracking customer attitudes and changes in behaviour in response to topical issues.

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