Exclusive data: Food, beauty and electricals retailers poised to win this Christmas

Retail Week’s Christmas Forecast report, created in partnership with Acuity Pricing, Feedonomics and Vypr, is now live, sharing detailed insight into the sectors on course for a stellar performance this peak.    

Featuring exclusive category-based sales forecasts from Retail Economics and consumer research data from Vypr, alongside insight from Retail Week’s team of analysts and commentary from leading retailers, the fifth annual iteration of the Christmas Forecast report will help retailers prepare for the sector’s zenith in 2025.  

Here we take a topline look at three sectors that can expect success this Christmas:

Grocery

The food and drink sector is where 51% of all shoppers expect to spend most this Christmas, according to new Retail Week and Vypr research.  

At the time of writing, food inflation is expected to remain sticky, averaging at 3.5% for the end of the year. And amid a highly competitive landscape and a year of well documented price wars, Retail Economics’ forecasts still envisage the grocers passing some of these costs to the consumer in Q4.  

As such, the value of food sales is expected to rise 3.8% year on year, compared to a 1.4% actual rise in Q4 2024, with volumes remaining broadly flat.

Loyalty will remain a key battleground for the grocers, with investment in membership and personalised promotions essential. However, the focus will shift from defending volumes to protecting margins.

Health and beauty 

The health and beauty sector continues to reap the rewards of a shift in consumer behaviour towards wellness and is anticipated by shoppers to be the second biggest category of spend this Christmas (34%) according to Retail Week and Vypr research.  

Newness and trend cycles continue to benefit the category – with challenger brands gaining traction propelled by social commerce on platforms like TikTok, which accelerate discovery and conversion.  

Inflation in the sector is expected to average at 2.5% in Q4, as continued demand and premiumisation allow retailers to hold prices despite broader pressures. 

Retail Economics forecasts 4.9% sales value growth in 2025’s Golden Quarter. This time last year, estimates forecast 2.8% values growth, which positively translated to 7.1% actual value growth over the Christmas period.

Electricals

The electricals sector can anticipate a welcome reprieve this Christmas, marking a recovery after three weak years, as consumers enter a natural replacement cycle. 

Retail Economics expects inflation to remain modest, averaging around 1.5% in Q4 as retailers continue to pass through import savings and price competition remains intense. Sales values are forecast to rise by 4% year on year, with volumes up 2.5%.  

New AI-integrated product launches and smart technologies are expected to reignite interest in the category, helping drive demand during peak season.

A recovery in real household spending power and a boost in savings are also set to support confidence, especially among mid-to-high income households.

Retail Week and Vypr research found that shoppers aged 35-44 anticipated spending the most on electricals this Christmas (34%) with male shoppers 12% more likely to anticipate spending on electricals than female shoppers.

Want more insight into what to expect from festive trading in 2025?