Discounters take a bite out of festive home products market

Tesco, Asda and Sainsbury’s were the most used UK retailers in 2017 for festive home products, but they are at risk of losing ground to discounters such as Wilko, B&M and Home Bargains in 2018, according to GlobalData.

Supermarkets have historically benefitted from Christmas shoppers buying on impulse during their weekly shop. This is particularly strong in festive home products compared with other festive categories, such as Christmas crackers and wrapping and cards. And they have expanded their festive home ranges, improving design and offering lower prices.

However, as discounters expand further physically and become more accessible to consumers (B&M has opened two new stores so far this December), Tesco et al will lose their primary competitive advantage, GlobalData predicts. The proportion of consumers purchasing festive home products at Wilko and Home Bargains increased by 3.2ppts and 4.1ppts respectively in 2017 compared to 2016.

“Discounters are attracting consumers by offering ranges which resemble those of more premium retailers – B&M has launched a new range of Christmas decorations which replicates John Lewis’s offer. This encourages shoppers to trade down from home specialists, which must promote superior design and quality if they wish to win shoppers in the last few days of the crucial Christmas trading period," says Amy Higginbotham, Retail Analyst at GlobalData.