It’s official: we are shopping small, with consumers willing to pay more to prioritise purchases from small businesses over larger competitors this Christmas.
New research reveals that more than half aim to have their gift shopping for the festive season completed ahead of December, with seven in 10 reporting that, despite cost-of-living pressures, they’re willing to spend more with smaller retailers over large corporations.
The desire to prioritise shopping small chimes with insight from GoDaddy over previous festive seasons, which typically sees a boom in small business launches as many seek to capitalise on the increase in consumer spending on gifts.
Competition for consumer spending is hotting-up, in particular around the key sales dates in the festive calendar. One in 10 consumers do the bulk of their gift buying on Black Friday, rising to nearly a quarter amongst 18-24 year olds.
it’s never been more important for small businesses to be front of mind and top of the screen
Wíth a fifth now buying gifts for between six and 10 friends and family members each Christmas, four in 10 are finding out about the best shopping deals through social media ads. Online cut-through is key for retailers targeting sales-savvy shoppers, with nearly two-thirds of those under 24 and over half of millennials finding their best festive shopping deals online.
This is borne out by small business owners. Over a tenth said that marketing was one of the biggest challenges when setting up their business. And nearly a fifth of microbusiness owners have prioritised investment in social media, ads and promotion in recent months.
Competing for customers is also one of the biggest sources of stress for small business owners, with a fifth saying that remaining competitive on pricing, marketing and attracting customers is one of their biggest headaches.
Andrew Gradon, Head of GoDaddy UK and Ireland, said: “With consumers increasingly making purchasing decisions based on what they see on their daily scroll of social media, it’s never been more important for small businesses to be front of mind and top of the screen. A small business doesn’t mean small ambitions.”
Gilbert: tech advances are making it harder to spot fakes
Separately, almost half of UK consumers cite concerns about payment security as a key reason for abandoning their shopping at the online checkout.
With Black Friday in mind, ecommerce businesses are being encouraged to optimise customer experience and specifically highlight payment security measures, or risk missing out on the opportunity the day presents to increase their sales, attract new customers and entice spending.
Commissioned by Mollie, one of Europe’s fastest-growing financial service providers, The European Ecommerce Report is an annual study of 10,000 consumers across Europe, to determine their views on what retailers need to do to attract, engage, and inspire them to purchase – and return.
The research shows that consumer expectations in the UK for a seamless shopping experience are among the highest in Europe, specifically around efficient checkout (89% cite this as important versus 81% European average). A good mix of payment methods (86%) and great customer service and support (83%) are also prioritised.
However, it’s not all festive cheer. The global intellectual property (IP) firm Marks & Clerk warned of the need for brands to step up their defences against spiralling counterfeit activity.
Given the heightened cost of living, brands are contending with consumers approaching this period of spending with more caution and restraint than usual, they say, while the need for cost-effective alternatives is also driving demand for counterfeit products. Compounding these challenges, rapidly evolving technologies are accelerating the proliferation of counterfeit goods.
And the stakes are high. Recent figures illustrate the scale of the challenge; in 2023, the UK Border Force intercepted nearly one million counterfeit items valued at approximately £200 million ahead of the holiday season. Across the Channel, the European Union Intellectual Property Office (EUIPO) reported an average annual loss of €12 billion for the European clothing sector from counterfeiting between 2018 and 2021, equivalent to 5.2% of all clothing sales across the EU.
Kirsten Gilbert, Head of Brand Exploitation, Protection, and TM Litigation said: “The direct financial impact is vast, but that’s only one part of the overall picture. The longer-lasting consequence is the effect these incidents can have on brand reputation. The reality of brand infringement is much more dangerous – for businesses and customers alike.
“Advances in technology are making it increasingly difficult for consumers to spot counterfeit goods amidst genuine sellers, with research finding that as many as one in four may unwittingly buy a fake product on Black Friday. As well as severely harming sales, the danger of untested electricals or harmful cosmetics can have serious, long-term impacts on brand reputation with end consumers.
“Even when the counterfeit products are not dangerous, the presence on the market of large numbers of counterfeit goods can make consumers reluctant to spend significant sums on genuine products when their exclusivity has been undermined by large numbers of fakes on the market.”
