How will the fourth corona wave affect the Christmas business in Germany? A new report from Mollie highlights the trends for the peak season 2021.
For many Germans, Christmas is the most important festival of the year. In many households, the starting signal for the contemplative time is given a few weeks beforehand, namely with the first Advent. The apartment is decorated for Christmas and the first cookies are baked. But buying Christmas presents gives many a headache. What retailers in Germany should know about this year’s Christmas business is highlighted in the new report “Christmas presents in Germany 2021” by Mollie.
Christmas business: That’s how much Germans spend on gifts
People remain generous when it comes to the budget of their Christmas gifts. According to Study by Ernst & Young the planned expenditure since 2019 is around 280 euros. The record year in terms of budget was 2018. Here, people spent an average of 281 euros. The men are currently more generous than the women with an average of 291 euros. The female population gave 271 euros as the planned budget for 2020.
Consumers in Berlin are the most generous
Differences can also be seen in a comparison of the federal states. The people in Berlin are the most generous, while the Saxons and Brandenburgers are the most economical when it comes to gifts. This comes from a Collection of idealo in 2019.
The trend in spending on Christmas gifts has been increasing in recent years. According to Statista, spending on Christmas gifts has been in the past ten years increased by almost 50 percent. Accordingly, despite the Corona crisis, the willingness to spend gifts can generally be rated as positive. Vouchers and monetary gifts are the most popular Christmas presents. Around 59 percent of the people surveyed planned to give away money or a voucher in 2020.
Christmas business: what has changed when it comes to giving gifts
Christmas is first and foremost the festival of traditions. As a result, there are some constants that have persisted over the years. Gifts such as groceries and sweets have been on the wish lists of children and adults for decades. This means that the delicacies are under the Christmas tree every year. Due to digitization, the selection of Christmas gifts is also changing, which also has an impact on the Christmas business. There is usually a mixture of haptic and digital gifts under the Christmas tree. Top sellers among digital gifts are digital vouchers and e-books. However, cryptocurrencies are also becoming increasingly popular as Christmas gifts.
Christmas business: These are the product groups with the highest turnover
A survey on the most popular product groups shows that 75 percent of those questioned like to “waste time together”. Medical products or animals are less popular: 90 percent of those surveyed are more reluctant to give these gifts. If you choose “Time together” as a Christmas present, you will delight both yourself and the person receiving the present – an advantage that probably makes this “product group” so popular. Here it is of course difficult to speak of an actual group of goods, since time is not a commodity in itself.
When and where consumers buy their gifts
Early or late, online or stationary, cash or with a card? The choice of time, place and payment method is becoming more and more diverse. Here, too, different developments in the Christmas business can be shown. According to a survey by Ebay Ads, a fifth of those questioned rack their brains about what should be under the Christmas tree in 2021.
Women in particular are real early birds when buying gifts. After all, 26 percent of the female population dealt with the topic of gifts as early as September. For men, on the other hand, it is only 15 percent. Two thirds of those willing to give gifts look for suitable Christmas presents between October and the beginning of December. For 27 percent of those surveyed, November is the most popular month to look for suitable Christmas gifts.
On the other hand, only 17 percent are late. They only take part in the hunt for suitable gifts in mid-December. This group mainly includes the younger generations between the ages of 18 and 29. A look at Google Trends shows that the search volume for the search term “Christmas presents” has been increasing steadily for the last five years from the end of September and reaches its peak from October to the beginning of December.
Online or stationary: where to buy Christmas presents
The most popular place where German consumers buy their Christmas gifts has changed a lot in recent years. According to a survey by Deloitte, the willingness to buy in stationary retail has decreased significantly. In 2015, 75 percent were still convinced that they would buy gifts in stores. In 2020, however, it was only 42 percent. The corona crisis put a big damper on stationary retail, as the usual offline shopping was simply not possible due to the lockdown.
Nevertheless, according to Statista, most of them have one personal advice from specialist advisors important. 65 percent trust his judgment or, alternatively, a recommendation from friends. Closely followed by 59 percent of consumers who see the Internet as an important component when looking for gifts. Search engines and customer ratings can help here. Research on the Internet followed by online shopping seems logical, but a stationary purchase after research is also conceivable. One speaks here of the so-called “ROPO effect” (research online, purchase offline). The telecommunications industry in particular is affected by this phenomenon, which also applies to the Christmas business.
This is how Cyber Week influences the Christmas business
Most people in Germany buy their gifts between November and December. This period falls exactly in the period of Cyber Week. Since Cyber Week now has a major impact on the entire retail sector, it is also gaining attention for the retailers’ Christmas business. With Black Friday and “Cyber Monday” the Christmas business begins in Germany as well. Bargain hunters can look forward to discounts here. Since Cyber Week primarily takes place online, large online shops in particular benefit from it.
The stationary retail trade, on the other hand, is not very enthusiastic about sales events such as Black Friday or Cyber Monday. In retail, there are usually no price reductions before Christmas, which is why the drastic discounts tend to damage online competition. The fact that large online shops can offer higher discounts than physical stores means that sales in stationary shops are shrinking.
Shortage of raw materials and consumption at Christmas
The economy is now recovering around the world, but the crisis has shaken the balance. Raw materials are scarce and delivery times are increasing. Does this endanger the Christmas business? The likelihood that all of our Christmas gifts are in danger is rather low. Provided that these are not utopian wishes. However, a completely different aspect causes headaches for the retailers: the wrapping paper!
According to Handelsblatt, paper manufacturers are lagging behind and are having difficulties producing graphic paper. The reason for this is the lack of waste paper. This not only drives newspaper publishers and printing companies to sweat. Even for all those who like to wrap their gifts nicely, it is important to look around for alternatives. Beautiful baskets, self-made gift bags or fabric replace the wrapping paper and give at least as much joy in giving.
This is how the pandemic affects the Christmas business
If the Christmas business for stationary retail was simply not available in 2020, this year it will be vital for retailers. The lockdown led to massive sales losses in 2020, while online trading experienced a boom. So shopping behavior was fundamentally turned on its head. For the Christmas season 2021 stand out loud Google assessments a variety of trends.
Looking into the future: A Christmas without “real” gifts?
Digitization is advancing from year to year and many processes are shifting to the Internet. But is it also conceivable that we will soon no longer receive any haptic gifts and that giving will even shift to the World Wide Web? Online trading is booming and growing from year to year. Nevertheless, it is important for consumers to give away personal and haptic items. Even when ordering online, many use the personalization field to write a personal message. Whether the retail trade will take place entirely online in the future is in the stars. However, it is clearly foreseeable that a steady turnaround will take place here. (sg)
About the author: Vanda Astfäller is Sales Lead DACH at Mollie and an expert in optimizing online shops. Mollie is one of the fastest growing payment service providers in Europe. By using different payment methods, Mollie enables companies to scale and grow. With the help of a payment API, merchants can offer different payment methods uniformly.