We are heading into a cautious Christmas period this year with people expected to spend 6% less on gifts than in previous years.

That is the conclusion of a recent survey carried out by the international consumer research company Intersperience, which showed that the average amount people are prepared to spend is £241 per person, with 45% of those interviewed admitting that the uncertain economic climate was impacting their shopping plans.

The Chief Executive of Intesperience, Paul Hudson, said “If that pattern played out uniformly across the 35million or so people of working age in Britain, the result would be a drop in total high street spending of more than £500 million.”

The biggest drop in spending plans is among those over 25 who, are expecting to spend £287 per person, almost £35 less than in 2009. The spending plans of  18- to 24- year olds in contrast, has shown a marked increase, with people expected to spend £189 this year compared with £168 last year.

Hudson added “Spending predictions are the lowest we have ever recorded, so it is clear that retailers are going to have to offer deep discounts in the next few weeks to generate an acceptable level of sales”.

The research also found that there was a significant shift towards online retailers this year, with 54% of people expecting to shop in stores and in websites doing so online. This increase is driven primarily by a 30% uptake in under 25s spending online compared to 2009.

Hudson stated that 2010 is a crucial time for retailers, “They did not do too well last year. There were big problems with stocking levels and delivering goods before Christmas Day and that drove people back to high street stores. The problems meant that one in five people spent less online than they had anticipated”.

Please note the views expressed in this blog are the views of the author, Andre Brown and do not represent the view of Locayta, its employees or its shareholders. For more information about Locayta, visit www.locayta.com