(Bloomberg) -- Shoppers are buying their loved ones prosecco instead of champagne as Britain’s cost-of-living crisis grows, putting pressure on card and gifting service Moonpig Group Plc (LON:MOONM).
More thrifty consumer spending has led Moonpig to cut its revenue guidance for the full financial year to around £320 million ($388 million), down from £350 million previously. Moonpig shares fell as much as 19% Wednesday.
The business has seen a “big step down in customer behavior” particularly in October and November, worsened by postal strikes at Royal Mail (LON:IDSI).
The retailer’s seen a “big shift” toward Italian sparkling wine retailing at around £15 ($18) down from the premium French option which costs £25 to £40, according to Chief Executive Officer Nickyl Raithatha. Moonpig has changed its range of gifts in recent months to include more cheap options such as mugs and chocolates.
“We have seen evidence of customers trading down, that started over the summer and really accelerated in recent months,” said Raithatha. “We are aiming to give the best range we can of lower priced items.”
To cope with postal strikes, Moonpig is sending reminders to its customers to buy cards and gifts earlier than usual for key events like birthdays. Last week Moonpig warned customers of delays to first-class card deliveries.
“We’re helping customers give gifts to people they care about on the day that they matter, birthdays and anniversaries,” said Raithatha. “Those cards cannot be late.”
©2022 Bloomberg L.P.