Written by Jenni Gill, Content Director
The 2025 Christmas season is arriving with a very different energy among shoppers: not less festive, but far more deliberate. Our flash post-Budget research with 1,000 UK consumers shows a nation trying to balance joy with realism. People still want to celebrate, still want to treat loved ones, still want a sense of normality; they’re just being far smarter about how they get there.
And that shift opens a huge opportunity for brands.
Christmas isn’t cancelled. It’s just being recalibrated
Despite months of financial pressure and a Budget that did little to dramatically shift household finances for the better, consumers are still protecting Christmas. Our research found that:
- 38% won’t change their plans at all
- 33% will slightly cut back, trimming the excess rather than the essentials
- Only 13% expect to drastically cut back, and even then, the pattern is more about reducing waste than reducing joy
Younger households (especially those with children) remain determined to make Christmas feel magical. Gen Z and Millennials are three times more likely to increase their festive spend than Boomers, reflecting a generational desire to preserve moments, not things. This represents thoughtful re-prioritisation, rather than a dramatic retreat.
Stress levels are real, and influence every choice
Almost half of consumers (49%) report that they feel some level of financial stress about Christmas this year. At the same time, 51% feel mostly or completely comfortable, creating a sharp divergence in mood depending on age, income and household type.
That emotional divide shapes behaviour:
- Stressed consumers default to caution and clarity
- Comfortable consumers focus on maximising value, not restricting spend
- Families feel pressure and optimism at the same time, and are therefore the most responsive to helpful brand engagement
The constant across all groups? A desire for a Christmas that feels good: not financially reckless, not wasteful, not out of reach.
Demand is alive but every pound now has to prove itself
This Christmas season sits firmly within the broader shift to “smart spending” we’ve tracked throughout 2025. When budgets tighten, people don’t stop buying; they change how they buy.
What they told us post-Budget:
- They are switching, comparing, delaying and stacking rewards
- They want deals, but not at the cost of quality
- They’re hunting for value, not just low price
- And they reward brands who help them feel confident, not compromised
One stat captures the moment clearly: 76% of consumers say they will take actions to help them secure better value following the Budget, be it switching brands or increasing their use of loyalty rewards.
The new role of loyalty in Christmas shopping
If Christmas 2025 has a secret ingredient, it’s loyalty, as a strategy for feeling in control. Shoppers are using rewards, cashback, and member-only deals to stretch budgets without shrinking the experience. For many households, loyalty is what transforms a “maybe” purchase into a “yes.”
Gen Z and Millennial families (the groups most likely to cut back slightly rather than drastically) are also those most likely to stack rewards, switch retailers, and optimise offers. They’re treating loyalty as a turbocharger, as opposed to simply a nice-to-have.
On the other hand, older households lean on loyalty for reassurance. Boomers, the most likely group to keep Christmas spend unchanged, use loyalty for consistency and trust rather than experimentation. Clear savings and dependable value matter more than novelty.
But no matter which demographic the consumer sits within - whether they’re buying a toy, beauty gift set, or festive food upgrade, shoppers feel better when they also feel smart. Loyalty turns small indulgences into “earned moments.” For brands, this means loyalty is no longer the post-purchase add-on; rather it’s the lever that holds festive spend together.
What this means for brands this Christmas
Christmas 2025 offers a rare alignment of sentiment and possibility. People are still spending. They’re still celebrating. They’re still showing up. But they’re choosing brands with far greater intention.
The brands most likely to win will:
Help people feel smart, not stretched. Show savings clearly. Make comparisons easy. Let your loyalty rewards do some of the emotional heavy lifting.
Turn loyalty into momentum. From families to young professionals, reward programmes have become a festive survival tool. Meaningful, easy-to-use benefits matter more than splashy seasonal offers.
Create value through experience, not just price. Thoughtful service, simple journeys, reliable delivery and personalised relevance all make a Christmas purchase feel “worth it.”
Dial up small joy. Consumers will still indulge, they just want to do it comfortably. Affordable treats, everyday luxuries and at-home entertainment punch well above their price point. This isn’t a low-spend Christmas; it’s a low-waste one.
Want the full view of how the Budget is reshaping 2026?
This blog draws on a subset of findings from dentsu’s From Budget to Basket report, our rapid-read analysis of UK consumer sentiment collected immediately after the Chancellor’s announcement. Read the full report here.
