The latest measure of retail sales is up 1.7%, more than treble the rise economists were expecting, but the spending spree may not last.
Morrisons belatedly launches its online service. But all supermarket chains are facing greater competition in the delivery market.
After dire warnings of a 'sea of red' on the high street, we're starting to get a flavour of how we all really spent before Christmas.
Online sales have become the "main driver for growth" in British retail, after Christmas sales figures showed how popular an option shopping on the internet has become.
David McCorquodale, head of retail at KMPG which is behind the figures, explained:
– David McCorquodale, KPMG
Whilst store sales continue to flatline, online sales remain the main driver of growth for the sector, contributing nearly three quarters of the uptick in non-food sales in the last quarter of 2013.
The winners this Christmas were those retailers with slick multichannel operations, who could offer consumers the flexibility to shop how, and when, they wanted to.
"One in five" non-food items bought this Christmas were purchased online, in what turned out to be a bumper year for festive internet sales, new figures have revealed.
Data from the British Retail Consortium (BRC) showed online trade represented 18.6% of total non-food sales in December, up from 16.5% the year before.
BRC director general Helen Dickinson said: "More of us clicked into Christmas than ever before, with online non-food sales growth putting in its best performance since March 2010 and accounting for nearly 20% of spending.
"The surge in the use of tablets and smartphones last year, together with the ever-faster delivery times achieved by an increasing number of retailers, has provided a new spur of growth to online shopping."
British baker Greggs said as many as 400 jobs could be scrapped as in-store bakeries are closed and management teams are restructured, despite the fast-food chain's strong Christmas trading numbers.
The company said it would work with trade unions and vacancies would be offered to employees working at the in-store bakeries "wherever possible".
Greggs said the cuts would save £6m a year from the middle of next year and £2m this year after costs of £9m for redundancy payments andwrite-offs on in-store baking equipment.
The company said like-for-like sales grew 2.6% in its fiscal fourth quarter, with sales in the five week festive period up 3.1%.
Sainsbury's chief executive Justin King has told ITV News that the chain's popular toys range is "new competition" for businesses like Mothercare, whose shares fell 30% today.
Mothercare shares ends day still down 30 percent - haven't recovered from early slump this morning
Shares in Mothercare fell by 30% today after the chain fell victim to fierce Christmas price wars.
Shares in the babycare products chain sank 126p to 294p after confidence in its turnaround plan was hit by today's profits warning.
Mothercare blamed a 9.9% plunge in UK sales on the "highly promotional" nature of the Christmas period and lower footfall.
Sainsbury's enjoyed its busiest trading week ever in the run-up to Christmas, helping like-for-like sales in its latest quarter climb by 0.2%.
Chief executive Justin King said the 14 weeks to January 4 had been a "very tough sales environment" but the supermarket managed to maintain its record of growth - after it was forecast to fall after 35 successive periods of expansion.
Mr King said the seven days prior to Christmas was the group's busiest ever trading week, with more than 28 million transactions.
Waitrose said the strong trading period was driven by growth in online groceries sales, which rose by more than a third in the five weeks to Christmas Eve compared with the same period in 2012.
It said that 619,000 people used their click and collect service in the same five-week period.
Waitrose says it has seen its most successful Christmas on record after sales for the twelve trading days up to December 31 were up 6.5% on last year.
Total sales for the five weeks up to Christmas Eve was 5.4% above the same period in 2012.
It said it also recorded its most successful single day of trading ever after taking £51m on Monday December 23.