German retailers aren’t feeling very festive

Christmas has always been a time for joy, cheer and celebration. However, this festive season brings with it a feeling of uneasiness for German retailers. With the uncertainty of Brexit and global unrest, as well as a turbulent economy, many merchandise outlets are feeling the pinch. So much so, that even faithful Santa Clause has become a mere reminder of Christmas past. This article takes a deeper look into the current apprehension of German retailers.

1. Germany’s Struggling Retailers

German retailers have been fighting a long-running battle to maintain their place in the global market. In recent years, they’ve found themselves plagued by a variety of economic and competitive issues.

During the Covid-19 pandemic, retailers in Germany have had to grapple with further challenges. Already weakened by a combination of overproduction, over-investment, and a strong euro, their sales sent plummeting as consumers stayed at home and restricted spending. Many large chain stores had to close their operations entirely, resulting in an estimated loss of more than 25,000 jobs.

This situation has left retailers struggling to maintain their relevance and keep up with the changing demands of their customers. In particular, they face the

following difficulties:

• Adjusting to new consumer behavior driven by digitalization
• Dealing with rising labor costs
• Navigating rising competition from online retailers

The long-term outlook for German retailers is uncertain. With improved access to data analytics and smarter technology, they must seize the opportunity to stay ahead of their competition and continue to appeal to their customers.

2. Causes of the Retail Woes

The retail woes in today’s climate can be attributed to several factors. However, one of the main causes is technology, which has changed the way people shop. The advent of ecommerce has made it even easier for shoppers to purchase say, shoes and t-shirts, from the comfort of their homes. Easy access to online marketplaces has meant a decline in footfall and business for physical stores.

The growth in spending power of customers and a shift in the way they are spending is another major contributing factor. According to research, more people are opting to buy experiences rather than products. This shift has left retailers without pieces to sell in their stores, shrinking the total demand for product. Additionally, more people today are opting to rent rather than buy, cutting down on the level of sales.

• Technology – The advent of ecommerce.
• Shift in Spending Habits – More people opting for experience purchases, rental rather than ownership.

3. Germany’s Low Festive Spirit

A Lackluster Occasion
Germany’s festive spirit is far from grand and joyful. The days leading up to Christmas tend to flow by with a sense of dullness, which doesn’t paint the most thrilling image of the season. The excitement and wonder of the build-up that is usually associated with the holiday are nowhere to be found, replaced instead by an atmosphere of solemnness, cold and subdued.

Societal Habits and Trends
What could be attributed to such a subdued festive spirit? The answer could very well be linked to the social habits and trends of the German people. Alcohol consumption tends to be limited, and gatherings with family, friends and co-workers are kept smaller than what is seen in some other parts of the world. Popular celebrations like trick-or-treating for Halloween or spending the night in costume for carnival are all but absent. Many tend to enjoy a hearty seasonal meal, with some Christmas markets thrown into the mix, but loud outbursts of joy fit among the more rare sights.

• Germany’s festive spirit is far from grand and joyful
• Alcohol consumption tends to be limited
• Family, friends, and co-worker gatherings are kept smaller.
• Popular celebrations like trick-or-treating are absent.
• Many tend to enjoy a hearty seasonal meal with some Christmas markets.

4. Hope for a Flourishing Retail Scene?

Even though the retail industry has been hit hard by the pandemic, there is still hope for the future. The following are a few effective strategies they can put in place to ensure a prosperous future:

• Digital Transformation: Retailers should continue to embrace new technologies and digital solutions, allowing them to increase visibility, manage their supply chain better and provide better customer service.
• Offer Multiple Sales Channels: In order to survive, retailers must offer multiple channels to reach their customers. This includes online, in-store and mobile options, creating a more seamless shopping experience.
• Practice Focused Marketing: Retailers must use effective marketing tactics such as email campaigns, online ads and social media to reach potential customers and drive traffic to their website or store locations.
• Data-Driven Strategies: Retailers should leverage the data they have to better understand their customers and create tailored experiences, campaigns and products to meet their needs.

By staying ahead of the curve and utilizing these strategies, retailers can create new opportunities for growth and ensure their business is set up for success in the years to come.

The festive season may not be feeling quite so joyful for German retailers this year, but that hasn’t dampened the holiday spirit of its citizens. After a tumultuous year, they remain resilient, determined to make the most of whatever 2020 still brings – whatever form that may take.