Austrians are spending more on gifts again

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Retailers have drawn a first, satisfied balance of the Christmas business. On average, we spend 386 euros on gifts.

December is the most important month of the financial year for most Austrian retailers and is considered the “5th quarter” within the industry. Christmas business determines whether the financial year ends successfully or not. In 2024, this crisis applies more than ever, even though this year’s starting position was primarily characterized by loss limitation due to the economic recession, countless bankruptcies, and below-average consumer sentiment.

The good news, according to the retail association, is that the current Christmas business has started far better than expected. The cold weather likely played its part in this, with domestic shopping centers recording high customer footfall and the shopping streets also seeing large crowds on the two Advent Saturdays. According to Standort + Markt, the second week of Advent was even the busiest week of the year.

“The sales forecast by the Austrian Retail Association and WIFO for the Austrian retail sector assumes total December sales of EUR 7.5 billion this year, with Christmas-related additional net sales of EUR 1.15 billion. Compared to the previous year (7.34 billion), we are pleased about a moderate increase of 2 percent,” says Rainer Will, Managing Director of the Austrian Retail Association. Adjusted for inflation, this corresponds to an increase of 0.6%.

Second-hand gifts could be the way forward this Christmas
“We are also seeing clear differences between the individual sectors this year. If we only look at the non-food sector, additional sales in December are EUR 26 million below the previous year’s level and around EUR 84 million below 2019,” says Jürgen Bierbaumer, Senior Economist at the Austrian Institute of Economic Research (WIFO).

Traditional Christmas business is defined as additional sales in December that are higher than average from January to November. Due to the pandemic, however, there have been additional factors since 2020 (e.g., strong fluctuations in sales during the year due to retail closures) that have made it difficult to define these additional sales precisely.

Last-minute shoppers will be on the scene in domestic retail next week. As many as six percent of consumers will only buy presents for their loved ones in the last few days before Christmas Eve. After December 24, cash gifts are redeemed, and the gift voucher business is booming well into January 2025.

“On average, Austrians will spend 386 euros on gifts this year, 26 euros more than last year,” explains Rainer Will. “Gift vouchers are booming more than ever this year (42%), and the trend towards cash gifts is also continuing (28%). This gives people freedom of choice. However, in many cases, they are used to pay bills and not to buy goods,” says Will.

This year, 29% of Austrian Christmas children will buy toys, and 24% will buy sweets. After all, 23% of each opted for clothing, cosmetics, and books to meet the preferences of their loved ones. It is also interesting to look at the distribution of spending: this year, 23% of Austrians want to buy their presents exclusively in bricks-and-mortar stores and only 6% exclusively online (previous year: 9%). Far East platforms such as Temu or Shein do not play a major role in Christmas shopping either—only 6% buy at least one of their gifts there. Domestic quality counts—hardly anyone wants to put a junk product from dubious Far East platforms under their loved ones’ Christmas tree.
“Our full-year forecast for 2024 for the Austrian retail sector of 77.2 billion euros net is derived from all these factors. A nominal increase of 2.7% compared to 2023,” says retail spokesperson Rainer Will. “For 2025, we expect this year’s Christmas business to have an even stronger impact in January, particularly due to the voucher business and the exchange phase in stationary retail after New Year’s Eve. We hope to see a significant improvement in consumer sentiment in the second quarter of 2025 at the latest.”

“The underlying momentum in sales development was mixed this year due to the weak general economic trend. The recessionary economic environment has weighed on consumer sentiment, while the savings rate has risen sharply. In real terms, however, sales increased slightly from the previous year. Another positive aspect is that inflation has normalized recently,” WIFO expert Jürgen Bierbaumer adds.