PARIS — ’Tis the season to be jolly for most European consumers.

This story first appeared in the December 9, 2013 issue of WWD. Subscribe Today.

Shoppers in 18 countries, mostly in Eastern and Western Europe, are ready to increase their budgets for the end-of-period for the first time since 2008, according to an annual Christmas study by Deloitte. They plan to spend on average 450 euros, or $613, a rise of 0.7 percent from the same period last year.

There is a stark divide between Northern and Southern Europe, though, with the latter still reeling from the impact of prolonged austerity measures. And while things are expected to improve, no one is popping the vintage French Champagne just yet: As in the U.S., the holiday shopping patterns in Europe are decidedly mixed.

While Germans plan to up their budgets by 6.7 percent and the Swiss by 3 percent, French consumers will be paring back their spending by 0.9 percent, Italians by 2.4 percent and the Greeks by 12.8 percent, the report found.

Books remain the most popular item, accounting for 31 percent of planned gifts, followed by chocolate (28 percent), cosmetics and perfume (20 percent), CDs (17 percent), cash (16 percent) and clothing and shoes (16 percent), Deloitte said.

The European Central Bank, or ECB, forecasts growth in the 17-member euro zone will increase by a modest 1.1 percent in 2014 after a projected decline of 0.4 percent this year. But ECB president Mario Draghi said there were reasons to be optimistic.

“The fundamentals of the euro area are strong in a sense because the major policy mistakes of the previous years are on the way to being corrected. The euro area can afford to make the structural reforms it needs,” Draghi said after the central bank revealed it was leaving interest rates unchanged at its meeting on Dec. 5.

NEXT:  A snapshot of the holiday retail outlook in leading European economies >>


Siegfried Jacobs, deputy director of the German Apparel Retailers Association, said it had been a disappointing year so far, with year-to-date sales failing to reach 2012 levels. A soft first half, an unseasonably warm fall and continued warm weather in many parts of the country have left retailers with high inventories.

“No one planned markdowns. But the fashion is on target, and we’re hoping for colder weather. With a little luck, we’ll be on par with last year,” Jacobs said.

The German Retailers Association, or HDE, is taking a somewhat more optimistic view, and forecast a nominal 1.2 percent rise in the nation’s Christmas business. “Consumers are in a good mood,” it said, adding that a recent poll of pure and multichannel players indicated that most expect a good Christmas.

This was backed up by GfK’s consumer climate monitor for November, according to which willingness to buy reached a seven-year high and the propensity to save “a new historic low.” Moreover, GfK is forecasting an even higher overall indicator for December.

“The appeal of saving, the alternative to spending, is falling further and further for consumers. Consequently, they are more likely to focus their financial means on consumption. This is certainly good news for the imminent Christmas business,” the GfK report stated.

A report by Ernst & Young released in November said German consumers’ gift-giving budgets have risen 19 percent to a median of 273 euros, or $372, per person. Apparel was the third most popular gift-giving category, and the audit and consulting firm’s report said department stores and shopping centers “will book clear gains in (their) Christmas business. Instead of 46 euros last year, consumers now want to spend an average of 79 euros” in these channels. E-commerce, which according to the HDE generates 7.5 percent of German retail sales, is projected to grow 12 percent in 2013 to around 33 billion euros, or $45 billion at current exchange, with online Christmas sales set to total 8.5 billion euros, or $11.6 billion.

Mathias von Bredow, founder and chief executive officer of Luxodo, a Hamburg-based platform of 65 European high-fashion and design stores, said “generally speaking, the climate is still very positive.”

He expects full-year revenues at the two-year-old firm to double. “Lots of off- and online retailers have big inventories to get rid of, but as a network, we have no inventories and are more flexible. The long winter and bad spring didn’t affect us,” von Bredow said.

NEXT: Great Britian >>


With consumer confidence up, and unemployment falling, Christmas looks to be a merry one for retailers — yet still in the context of austerity Britain. According to market research firm Mintel, retail sales are expected to grow by 4 percent in December to 40.6 billion pounds, or $66.3 billion at current exchange. Online sales are expected to rise 16 percent year-over-year to account for 12 percent of all retail sales in December, with 34 percent of shoppers polled by Mintel saying they would be buying most of their presents online.

Takings from online retailers are expected to exceed the 10 billion pound, or $16.3 billion, mark for the first time. Click-and-collect services will prove to be popular too, with 17 percent of shoppers expected to use this method for their shopping.

“Everything seems to be coming together at the right time for retailers this year and we expect to see a strong Christmas,” said Mintel’s director of retail Richard Perks.

According to its latest Christmas pre-trading figures, British retailer John Lewis is riding a wave of spending, fueled in part by Black Friday promotions. The department store said its 40 shops and its Web site recorded sales of 147 million pounds, or $241 million, in the week ended Dec. 1, up 18.4 percent on the same period a year earlier and up 31.4 percent versus the previous week. Online trade at was up 35.7 percent year-over-year.

Among the top sellers were iPads, televisions and Sony’s PlayStation4. Fashion sales rose 16.6 percent during the week, the store said.

Sales appear to be robust in the luxury arena, too. Ulrik Garde Due, ceo of Temperley London, which has a flagship on Bruton Street in Mayfair, said pre-Christmas trading has been strong so far, with foreigners flying to London to do their Christmas shopping, and domestic customers following suit. “Gifting kicked in mid-November, and there is very strong trading now that the weather has gone colder,” he said, adding that scarves and knitwear are among the biggest pre-Christmas sellers.

However, George Wallace, ceo of consultancy MHE Retail, said Christmas won’t be stellar across Great Britain.

“Christmas is going to follow the pattern of the past few seasons: It’s going to happen late, and shoppers will be online and looking for deals. Don’t forget that people are not being paid much more money, while energy and transport costs will be going up,” he said.

“It’s a slightly dreary picture, although we’re not facing Armageddon. And it’s in line with the two-speed economy we are seeing in Britain now, with London doing well and the rest of the U.K. lagging. The tills may be ringing here, but I don’t think they’re ringing in Bradford or Leeds,” Wallace said.

NEXT: France >>


In France, the catchphrase of the season is “fiscal shock.” With more than half of French taxpayers seeing a rise in their annual income tax bill, which traditionally comes due in fall, shoppers again plan to spend carefully and compare prices, seek out discounts and map out their purchases in advance.

The French intend to spend on average 326 euros, or $444, on gifts this Christmas, down 5.8 percent versus 2012, according to a survey by French research institute CSA for BFMTV channel. Of these, 45 percent plan to spend between 150 euros and 450 euros, or between $204 and $613, it found.

Pierre Pelarrey, managing director of the flagship Printemps department store in Paris, said consumers appear to be deferring their Christmas purchases.

“There is a stronger rise in foot traffic than there is in sales, which means either that we are seeing the impact of the economic crisis, which is probably the case, or that people are deferring their purchases and coming to compare prices. We are definitely seeing more of that than last year,” he said.

Top sellers include fashionable warm-weather gear such as Ugg boots, Moncler and Canada Goose outerwear, gloves and cashmere items in every color, Pelarrey noted.

The store’s La Boutique Noire seasonal gift shop is doing brisk trade in light fixtures, wooden objects and headphones, and there is strong demand across the board for high-end items such as niche perfumes and python handbags, he added.

Pelarrey expects total sales for the year-end period to be up from 2012, though probably in the single digits. “More people will be coming into the store — it’s up to us to convert them into customers,” he said.

Brick-and-mortar stores are being challenged by e-tailers more than ever. Online revenues are expected to reach 10.3 billion euros, or $14 billion, this Christmas, up 14 percent compared with last year, according to the Federation for E-commerce and Mail Order Sales, or Fevad.

“Internet users are allocating an increasingly large share of their gift budget to online purchases. Indeed, they plan to spend 60 percent of their budget online, versus 58 percent last year,” said Bertrand Krug, head of the department of online efficiency measurements at Médiamétrie, which conducted the survey for Fevad.

NEXT: Italy >>


According to Italian retailers’ association Confimprese, consumers in Italy have been slower to regain confidence in the market than their counterparts in Germany and the U.K., among others.

The association reported that 86 percent of Italian consumers do not consider this a good time to shop, and four out of five say they have changed their shopping habits compared with last year.

La Rinascente ceo Alberto Baldan said overall sales for 2013 were up over the previous year, and he expected the momentum to remain strong throughout the holidays.

Top categories this season included men’s and women’s shoes, and cosmetics sales were strong. The Italian department store, which counts a large number of tourists from China and Russia among its clients, has also seen positive results with accessories and various design objects that are perceived as good gifts.