Coles boss Leah Weckert expects shoppers to celebrate Christmas on a budget as consumer confidence plunges

Coles boss Leah Weckert expects shoppers to celebrate Christmas on a budget and make every dollar count amid soaring interest rates and fuel prices that have pushed consumer confidence to record lows.

Speaking as she unveiled Coles’ Christmas range in Sydney on Thursday, Ms Weckert said customers were thinking more carefully about their time and money this coming holiday season, particularly with the threat of another rate hike next month.

“We know that every dollar is going to count this year and so value is a really big focus of the range,” Ms Weckert told The West Australian.

“Customers are telling us they still want to make Christmas really special, but they are going to be doing it on a budget and every dollar is going to count.

“Younger customers are definitely more budget conscious than other customer cohorts and we’re seeing a lot of the same (shopping) behaviours that we’ve seen for some time.”

These behaviours included trading into more affordable options, with customers opting for chicken instead of steak. They were also using Flybuys points to help offset the cost at the checkout.

“What’s new in the past few months is that more and more customers are using artificial intelligence tools to help them do price comparisons,” Ms Weckert said.

“It’s around 30 per cent of customers that tell us that they are checking prices online to work out where to go and do that shop, so they are really informing themselves and investing time to make sure that they’re making the most of every dollar they’ve got in the budget.”

Coles’ Christmas range features more than 370 private-label products across groceries, gifts, decorations and liquor — including what the supermarket said would be this year’s main event, Coles Finest spiral ham with cherry and orange glaze.

More than 200 Christmas products are priced $10 or less, while the Coles Finest Christmas range has grown 40 per cent to 49 products this year.

Coles research found 52 per cent of customers plan to manage their Christmas food budget by buying on special or discount, while 49 per cent expect to plan ahead and compare prices, and 45 per cent plan to use loyalty points or rewards.

Around three in four shoppers expect to spend the same or more on Christmas food and drink than last year.

Economists expect shoppers to tighten their wallets even further as fresh figures this week revealed confidence in the economy had plunged to its lowest level since the early 1990s recession.

Consumers are being squeezed from all sides, with the average price of petrol creeping up towards $2.50 a litre and nearly $6000 added to the average annual mortgage repayment following last month’s rate rise.

Compared with five years ago, the prices of grocery staples were up nearly 40 per cent. Even the price of a cafe coffee could go up thanks to the much-anticipated card payment surcharge ban coming into effect.

“We think that customers are going to be spreading their spend as we come into Christmas to buy things ahead of time so that the cost of that final week shop is a little bit lower,” Ms Weckert said on Thursday.

“We’ve really looked to do things like on a lot of the packaged products, how do we make sure the expiry dates go to well after Christmas so that you can buy up a little bit early.”

Major competitor Woolworths the same day launched its festive range of nearly 500 products — including more than 120 food items, as it pitches a three-course Christmas spread starting at $100.

Ms Weckert is confident Coles’ range has options for shoppers at every price points.

“If you think across mince pies, there’s a value option, there’s a mid-tier option and then there are some Coles Finest options,” she said.

The reporter travelled to Sydney as a guest of Coles.