eBay advertising Christmas spend trends report

Covid-19 has caused Christmas to begin earlier than usual in the UK, with over a quarter (27%) of consumers planning to start Christmas shopping and preparations earlier than they did last year. That’s according to new research published today by eBay Advertising, which reveals the expected impact of the pandemic on this year’s festivities and highlights how new interests adopted during the lockdown could influence shopping lists.

According to a survey of 2,064 UK consumers who celebrate Christmas, over a third (34%) have already bought some Christmas-related items this year, including Christmas cards (17%), wrapping paper (16%) Christmas presents (13%) and Christmas decorations (8%). One in every twenty-five (4%) respondents even admitted to having already forked out on festive clothes and accessories – suggesting that, for some, Christmas spirit is well underway.

This behaviour has been confirmed by eBay insights into the shopping behaviour of the 32m monthly users on ebay.co.uk, with 44% more searches for ‘Christmas’ or ‘xmas’ made on the site from April to May this year compared to the same period in 2019.

Meanwhile, purchases are predicted to be more passion-driven, with the research revealing that over half (56%) of consumers surveyed have taken up a new hobby or interest during the lockdown, and 31% observed a family member doing the same. Of those who have taken up a new hobby or interest, three quarters (75%) intend to continue with it for at least the rest of the year – meaning these interests are likely to wield influence over Christmas wish lists.

The two most popular new hobbies taken up during the lockdown were gardening and baking – a fifth (20%) of those surveyed said that they’d got into gardening, and the same number said they’d developed an interest in baking. On ebay.co.uk, searches for ‘gardening’ peaked during week five of the lockdown, up 137% from the week before lockdown began, while searches for ‘baking’ peaked during week six, up 149% compared to the same reference point.

Harmony Murphy, head of advertising UK at eBay, comments: “In a year steeped with uncertainty, the only thing we know for sure is that this year’s Christmas will be an incredibly important retail milestone. And, with so many events, occasions and gatherings cancelled this year, it’s easy to understand why Brits are already excited and planning ahead for a more thoughtful and meaningful celebration.

“However, with so much having changed this year – from plans and priorities to interests and incomes – brands now face a huge challenge as they look to make their Christmas campaigns relevant to a transformed consumer. If they haven’t already, marketers must start planning and putting Christmas strategies into action – and use the freshest insights and smartest technology to reach the right people with the most meaningful messages. Precise, real-time targeting tools, such as the new eBay Advanced Audience Technology (eAAT), have huge potential to help brands to expertly target in-market shoppers this Christmas based on proven passions and interests.”

Unsurprisingly the research also indicated that financial insecurity could lead to shoppers making more thoughtful purchases this Christmas. 37% of respondents said that income or financial security was a top factor that will influence what they decide to buy or how they spend on gifts and celebrations in the run up to Christmas. And, while last year UK consumers spent an average of £551 on Christmas shopping and celebrations, this year almost half (44%) of consumers are planning to spend the same this year, a third (31%) plan to spend less.

As consumers look ahead to Christmas, 57% of respondents said that one of their top priorities is to spend time with loved ones. Meanwhile, 37% intend on putting more thought into the presents they give this year, compared to previous years.

Pauline Robson, managing partner at MediaCom, commented: “Whilst the buzzword as we went into lockdown was ‘unprecedented’, the word as we emerge is ‘flexibility’. The approach to Christmas this year is definitely one of caution, flexibility and adaptability. People’s habits and behaviours have changed and are adapting as restrictions ease and the trajectory of the virus over the coming months is uncertain. Scenario planning is key to ensure that we can adapt to any changes that may happen.

“From an audience perspective it really can’t be one size fits all – there have been many different lived experiences of lockdown and there are many different approaches to coming out of it. These will, to a large extent, shape the kind of Christmas that people will have. Up to date audience data and insight are crucial to ensure that Christmas campaigns can flex to changing consumer needs and will resonate with audiences.”

In a bid to support brands during this time of uncertainty, eBay has launched a new report – Christmas spend trends: the path to profit during a pandemic – outlining insights into consumers’ evolving attitudes and priorities and offering actionable advice to help advertisers ensure this Christmas is a commercial success.

Businesses in regions hardest hit by pandemic to drive local spend

Two regions in the UK hardest hit by the pandemic are to receive a boost with new gift card programmes designed to stimulate the local economy. Southport and East Ayrshire launched Town and City Gift Cards in association with Scottish tech firm Miconex in early August.

In East Ayrshire, the scheme is a joint initiative between the local council and the Kilmarnock Business Association. Over 80 businesses like Brownings the Bakers, Faulds the Butcher and Bar Luca have signed up to the programme.

Southport Business Improvement District are behind the Southport Gift Card with over 60 retailers and local stores registered, and an aim of increasing this to 150.

Cards can be purchased with a value of £10-£500 as gifts with the recipient able to use the card like a debit card across multiple outlets.

Data from the ONS shows that 61% of businesses in Scotland and 60% of businesses in the north-west reported a decrease in turnover in June and July 2020. This compares to 58% in Wales, 57% in England generally and 54% in Northern Ireland. Sectors particularly affected include arts, entertainment, recreation, accommodation and food service.

Southport BID CEO Rachel Fitzgerald commented: “Credit on the Southport Gift Card will be redeemable through multiple transactions at participating businesses within the Southport BID area. We want the card to help drive local spend and a shop local message. Our focus is firmly set on helping our local businesses in Southport to recover from this Covid crisis. We are doing everything we can to help our town.”

East Ayrshire councillor Jim Roberts suggests that the East Ayrshire gift card will go some way to repair a local economy devastated by lockdown: “We’ve realised just how much we need our small local retailers. It’s really important that we all now do our bit to support them through the tough times that will inevitably be ahead.”

Yet, there are signs that customer confidence is returning with YouGov reporting that consumer confidence rose for the third consecutive month in July, achieving positivity for the first time since February.

Managing director of Perth based Miconex Colin Munro said that the launch of the Town and City Gift Card scheme in East Ayrshire and Southport will support businesses with their post-covid recovery efforts:

“The pandemic has caused a significant change in customer behaviour. 62% of people have been shopping on their local high street during the pandemic and 70% of those who shopped locally will continue to do so. Local authorities and business improvement districts want to make this a permanent change in behaviour, presenting a viable alternative to online gift cards like Amazon and Apple that take spend out of the local economy.”

“Miconex developed its first gift card programme in Perth in 2015. We now have over 40 cities and towns with programmes, £1.5m in sales and over 6,000 participating businesses registered. 8 more programmes will launch in the next two months. The Town and City Gift Card programme works like local currency through the Mastercard network. Recipients of the gift card spend it with local retailers which drives footfall, supports local businesses and stimulates economic activity.”

As a former restauranteur, Mr Munro is well placed to understand the needs of a small business: “Some 10-12 years ago, I was running a seafood restaurant in north east Scotland. As a business owner, you just want to be able to tell customers what you’re offering. That was a problem I wanted to help with in an evidential and meaningful way.”

“Even though I’m working from the other side now with place managers and local authorities, I haven’t lost that small business owner mindset and understanding. Over the years, this knowledge has fed into Miconex initiatives like Mi Rewards, a simple way of automatically rewarding customers for spend or Mi Inverness, a hub for businesses in the highlands to easily share their news and offers.”

“Small local businesses have progressed more in the past 3 months than they have in the last 3 years because they’ve been forced into this position where they have to bring in new revenue streams. When a town or city joins our Town and City Gift Card programme, we make it easy for small businesses to start getting redemptions from customers with a single registration and no ongoing commitment.”

In July 2020, Scotland’s Town’s Partnership launched its Scotland Loves Local campaign in association with the Scottish government, an initiative that Mr Munro believes is vital for encouraging consumers to think local:

“It’s heartening to see this high profile, government backed campaign to drive permanent consumer behaviour change, supporting businesses as they adapt to the post covid landscape, and educating and encouraging customers to shop locally.”

Alongside the government’s announcement of £20m in funding for small business in England, Mr Munro believes that the UK government can further support the high street by raising the tax free gifting limit to £500.

“Another trend we’re seeing is for employers to use gift cards to reward their staff and with our programmes they can support their local economy too. At the moment, any reward over £50 given by an employer is subject to tax through the HMRC trivial benefits allowance. By raising this to £500, the government could stimulate spend where it is most needed, on high streets up and down the UK.”

Tough times ahead as spending intentions remain low

The BRC and Opinium have been working together to track consumer behaviours and their sentiment towards coronavirus. This research has run weekly since 1st May 2020, with the latest survey taking place between 31 July – 4 August 2020.

• Spending Intentions: 24% of respondents say they expect to spend less than usual over the next month compared with 11% who say they will spend more (61% intend to spend the same, 4% prefer not to say).
• Spending Intentions: When asked about specific products, the most common categories for reduced spending over the next month were fashion/clothing (37%), small electronics (28%), large electronics (27%) and health and beauty (27%).
• Purchases: 62% of respondents feel comfortable about buying groceries in store, up from 56% the week before. The average for non-grocery categories rose to 42%, a new record, from 38% last week. It is likely the introduction of masks has helped improve these figures.
• Shopping visits: 14% of shoppers intended to visit shops to browse, up from 12% at the start of July. 58% intended to visit shops only if necessary (up from 52% at the start of July). Those who said they would avoid visiting shops if possible fell to 23%, down from 32% at the start of July. Younger (18-34) respondents showed the most willingness to visit shops, with 20% saying they intended to browse, compared with 19% who intended to avoid going to shops if possible.
• Safety: 51% of respondents felt that retailers were doing enough to protect the public from coronavirus, with only 13% disagreeing.

Helen Dickinson OBE, chief executive of the British Retail Consortium, said:

“Spending intentions remain down among UK consumers, suggesting retailers will continue to face hard times in the months ahead. This was particularly true for clothing and fashion, which has been particularly hard hit by the pandemic.

“Nonetheless, the public continue to be reassured by the many safety measures that have been put in place by retailers, such as perspex screens, increased hand sanitiser and regular cleaning. Four times as many people believe retailers are doing enough to protect the public, as disagree, and this has been reflected in the rise in footfall.”

Clear evidence that the auction world has changed forever

Over 3,000 people registered to bid online at Ewbank’s latest three-day sales series, providing the clearest evidence yet of the mass migration online of the fine art and antique auction business.

“It’s a global phenomenon – what we have seen is the march of technology accelerate by ten years in as little as six weeks,” said the auction house’s chairman, Chris Ewbank, whose memorabilia department has also just sold the unique football collection of former Manchester United captain Norman Whiteside for £250,000.

Mr Ewbank, who believes that there is no going back, watched as 3,103 online bidders from all over the world competed for 1,388 lots over three days from July 22 to 24 at his saleroom near Guildford in Surrey. In 2019 similar sales attracted around 1,800 online registrants.

But it’s not just the number of bidders that has changed, he reveals.

“Selling rates have also soared consistently since lockdown, with anywhere from 85% to 95% of lots going to new owners, whereas before conversion rates of 70% to 75% would have been seen as successful.”
Prices have also been holding up well, with the three-day sale total reaching its top estimate of £420,000, while the Whiteside sale was around 40% above the highest expectations.

“When you consider how difficult life has been through lockdown, with auction rooms having to close their doors entirely to visitors to start with, and still having to limit numbers because of social distancing, the transformation of the industry has been nothing short of miraculous,” says Mr Ewbank. “Our saleroom turnover to the end of July in 2020 is over 12% ahead of 2019 in site of the horrendous problems caused to businesses throughout the world by the pandemic.”

“It’s not just that people have been registering to bid online from all over the world in their thousands, but that prices for even some quite mundane objects have gone through the roof.”

A good example of this is a Chinese famille rose vase sold for £23,000 against a reasonable estimate of just £2,000-4,000 on July 24, the third day of the three-day bonanza.

Prices also soared for the Whiteside auction, with the top lot, as expected, being his 1985 Manchester United FA Cup winner’s medal, but the price an unexpected double top estimate £30,000.

“If that was a thrill, prices for other lots in the sale were astonishing,” said Mr Ewbank. “Whiteside’s Northern Ireland Football Senior International shirt, which he wore in first match for the side against Yugoslavia in the 1982 World Cup, had an upper estimate of £8,000 but went for £18,000, while his Manchester United FA Cup final shirt had been expected to sell for £4,000-6,000 but made £23,000.”

Mr Ewbank says that the mass shift online for auctions is industry wide and global – and it’s not just for the cheaper or middle market lots – and those auctioneers who did not have the technical capability to move bidding online before have been adopting the technology now to keep pace.

“Look at what’s happening with Christie’s and Sotheby’s now. They have both converted their top summer auctions to online events and taken hundreds of millions of pounds in the process, with individual trophy paintings from Old Masters like Rembrandt to Contemporary Art by the likes of Francis Bacon selling for more than £10m each through virtual bidding. This would simply never have happened before.”

Sotheby’s CEO Charles Stewart confirms the trend, saying that while the change may be driven by necessity, it shows how resilient and adaptable the art and luxury markets are, a fact supported by his company’s latest set of results, which show now more than a 25% fall in year-on-year sales revenues despite the pandemic. Stewart says clients’ interest and confidence in technology has “fundamentally changed”.

With several sales scheduled throughout August – normally a quiet period – Ewbank’s are already noting considerably more interest than usual.

“It’s heartening to see how versatile our industry can be and that means we can protect jobs and investment,” said Chris Ewbank.