Europeans are tightening their belts and spending less on Christmas gifts this year as they struggle with incomes hit by austerity measures or fear the economy could worsen in next year.
Sharp spending cuts and tax hikes caused by the debt crisis in countries such as Britain, Italy, Greece and Spain, along with fears of a recession next year, are leading many consumers to cut back their spending despite a flurry of promotions.
“Many shoppers this year find they need to consider their spending more astutely, reduce the number of people on their Christmas lists and turn to more practical and useful presents when gift giving,” said Deloitte in its annual Christmas spending survey.
The consulting firm estimated in September that overall Europeans would trim their spending on Christmas gifts, food and entertainment this year by an average of 0.8 percent to 587 euros (US$763), although the results vary considerably by country.
With the deepening of the crisis over the past two months the belt-tightening is likely to be even greater.
This is something that many Chinese manufacturers who were left with piles of unsold toys and decorations discovered first hand.
Jean-Emile Rosenblum, cofounder and vice president of the Pixmania electronics and photo publishing Web site that operates in 26 countries, estimates a 5 percent to 7 percent drop in the average sale amount as customers cut back.
“There has been a crisis effect, cheaper products are selling, consumers are looking for the cheapest prices,” he said.
“There are countries where things are getting tougher and tougher,” added Rosenblum, citing in particular southern European countries.
While Deloitte was still forecasting in September a modest gain in holiday spending in France at 1.9 percent to 606 euros per household, the CREDOC research group expects spending on gifts to fall although food expenses should hold up.
Internet retailers are some of the few to have something to cheer about as bargain-hunting consumers flock to the Web.
“In times of reduced spending people turn in particular to e-commerce,” said Xavier Garambois, head of the Amazon in France.