Coles is reporting early signs that Australians are feeling more financially secure heading into Christmas 2025. This shift appears to be driven by falling interest rates and easing inflation. In response, the supermarket has launched a significantly expanded holiday range built around premium food and drinks, private label offerings and exclusive liquor products, aiming to stay competitive with Woolworths.
After a period of careful budgeting, shoppers now seem more ready to spend during the festive season. Coles, which started as a department store in 1914 and is now one of the nation's major supermarket and liquor chains, is positioning itself to make the most of the renewed consumer optimism. Retail research shows that more households plan to celebrate with gifts, decorations and high-quality meals. This signals a shift from the more restrained spending patterns of recent years.
From July to August, Coles posted strong sales momentum, doubling the pace of Woolworths and narrowing the market capitalisation gap to $900 million. The company reports that 71% of consumers planning to increase Christmas spending will focus on food, with gourmet meats, seafood and desserts leading holiday shopping lists. Over one third of these shoppers are also looking for premium and specialty grocery items, marking a clear move towards more luxurious purchases.
Part of Coles' strategy involves growing its liquor division, which includes adding exclusive private label beverages to rival some of the most popular products in the market. Unlike Woolworths, which separated its liquor operations in 2021, Coles continues to operate a combined food and liquor business. To improve efficiency and brand visibility, it is uniting its three previous liquor brands under a single Liquorland identity.
If these spending patterns hold, it could indicate a wider retail recovery and stronger market confidence heading into 2025. However, a rise in retail theft across Victoria has led Coles and other major retailers to push for tougher crime prevention laws, raising concerns about the safety of staff and shoppers. As public and corporate focus increases, it remains uncertain whether government action will follow quickly.
