Christmas shopping in Romania, undeterred by financial worries

Autor: Bancherul.ro
2008-11-12 11:33

• 46% of Romanians say that the economy is in recession compared with 3/4 of Europeans
• 50% of Romanians think that the financial crisis is not having a direct impact on their personal situation
• 45% of Romanians plan to increase their Christmas holiday spending this year
• With Romanians exercising more self-control in reining in their consumer appetite, more of them are setting a Christmas shopping budget (48% compared to 37%, last year).
• 69% of Romanians say they prefer premium brands and are not interested in discount stores.

Bucharest, November 12 – While almost half of the Romanians plan to increase their Christmas holiday spending, the local consumer behavior is slowly shifting from impulse buying to careful considered purchases, due to negative economic expectations, a recent Deloitte survey shows.
“45% Romanians expect the economy to deteriorate in 2009. However only a few of them believe they will have less purchasing power than last year, even though as yet they have felt direct impact from the financial crisis, which was only beginning at the time of our survey. Within this morose European climate, 45% of Romanians intend to increase their Xmas holiday spending,” reads the report.

Europe reacts differently to the bleak economic outlook

The Christmas consumer spending survey, now in its 11th edition, covers 16 European countries, South Africa, and the United States. Romania, Slovakia and Ukraine have joined this study for the first time. Information has been collected via Internet, with a structured questionnaire for a sample of individuals (618 in Romania), within controlled panels.
“Since we began this survey, rarely have we been confronted with such an unstable environment,” acknowledged Deloitte specialists. “In this context, any attempt to predict the level of Christmas purchases is necessarily subject to a considerable level of uncertainty. (…) Whatever the purchasing intentions declared today – our survey was performed during the last week of September and the first week of October – this year a large proportion of consumers’ actual purchasing decisions will undoubtedly be taken at the last minute based on their perception of the economic environment as a whole and its likely impacts on them.”
While 60% of the Europeans surveyed anticipate an economic downturn and lower purchasing power in 2009, 40% of them intend to limit their end-of-year spending on gifts and half of them will budget their spending this year. Consumers are particularly concerned by the increased costs of food and energy.
A general conclusion is that Western Europe is increasingly focused on saving, while countries in Eastern Europe, Romania included, are focused on spending, since this region has yet to feel the heavy impact of the current international crisis.

A more mature attitude towards shopping

For the first time, this year’s Xmas survey reveals a majority of Europeans intending to maintain control over their spending, with one in two Europeans intending to budget his or her year-end shopping (as opposed to only one in three in 2007).
Romanians also get more careful, more of them setting Christmas shopping budgets (48% compared to 37%, last year).
“The study reveals that Romanians’ proverbial appetite for shopping, while still going strong, is slowly moving towards a more mature approach of purchases,” said George Mucibabici, Chairman Deloitte Romania. “This is an important message for retail operators. Consumers are keen on buying useful products, but also want to take advantage of special offers. They are looking for more information ahead of a purchase and also want the best value their money can get.”
Retailers must therefore satisfy the desire to consume while providing good reasons for doing so. They will also need to focus on pre-Xmas special offers and purchases made after the holiday period, which account for 78% of all purchases in Romania.

New consumption patterns

The year-end holidays is a key period for consumer spending, both for consumers and retailers and consumer goods industries. While the first ones set aside their usual purchasing behaviour and give free rein to their desires, for the latter this period represents an extremely profitable time, the so-called “thirteenth month” of revenue.
The 2008 survey, carried out in this unstable environment, has the significant advantage of highlighting the new structural purchasing criteria adopted by consumers together with their expectations of retailers, products and brands. Determining the appropriate response to these expectations, by identifying the most effective levers, will be the key to liberating the desire of consumers to go shopping in such an important season as the Christmas shopping one.

Some conclusions:
• Clothes and shoes come top of the gift wish-list in Romania
• Demand for gifts in the form of money and gift vouchers continues to rise, reflecting a persistent desire to make their own gift choices or have money to cover everyday expenditure.
• Traditional toys hold their ground but electronic toys are nevertheless penetrating the young children’s segment in Romania
• In the East European countries the two first choices for teenagers gifts are computers/laptops and mobile phones. Romania sticks to this trend.
• Contrary to the European trend, Romanians prefer premium brands and they are not interested in discount stores.
• Romanians mainly shop their gifts in hypermarkets (77%).
• Romanians are concerned with production methods and manufacturing countries: these two aspects drive the choices made by 56% and 66% of Romanians, respectively. They seem more inclined to pay a higher price for these benefits – 73% in Romania versus 57% in Europe
• Also, 69% of Romanians say they prefer premium brands and are not interested in discount stores. 22% Romanians will buy more premium brands this year than they did last year.
• One useful tool in doing this is the Internet. Romanians use it to compare prices and also consider it an important source of information.
• The top three types of gifts purchased online in Romania is books (39%), jewellery / watches (24%) and MP3 Players / iPods (21%).
For a copy of the survey please visit: www.deloitte.com/ro/Xmas-survey-2008-Romania
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About Deloitte
“Deloitte” is the brand under which tens of thousands of dedicated professionals in independent firms throughout the world collaborate to provide audit, consulting, financial advisory, risk management, and tax services to selected clients. These firms are members of Deloitte Touche Tohmatsu, a Swiss Verein (“DTT”). Each member firm provides services in a particular geographic area and is subject to the laws and professional regulations of the particular country or countries in which it operates. DTT helps coordinate the activities of the member firms but does not itself provide services to clients. DTT and the member firms are separate and distinct legal entities, which cannot obligate the other entities. DTT and each DTT member firm are only liable for their own acts or omissions, and not those of each other. Each DTT member firm is structured differently in accordance with national laws, regulations, customary practice, and other factors, and may secure the provision of professional services in their territories through subsidiaries, affiliates, and/or other entities.
About Deloitte Central Europe
Deloitte Central Europe is a regional organization of entities organized under the umbrella of Deloitte Central Europe Holdings Limited, the member firm in Central Europe of Deloitte Touche Tohmatsu. Services are provided by the subsidiaries and affiliates of Deloitte Central Europe Holdings Limited, which are separate and independent legal entities.
The subsidiaries and affiliates of Deloitte Central Europe Holdings Limited are among the region’s leading professional services firms, providing services through more than 4,000 people in more than 30 offices in 17 countries.

About Deloitte in Romania
In Romania, the services are provided by Deloitte Audit S.R.L., Deloitte Tax S.R.L., Deloitte Consultanta S.R.L. and Reff & Associates SCA (jointly referred to as "Deloitte Romania") which are affiliates of Deloitte Central Europe Holdings Limited. Deloitte Romania is one of the leading professional services organizations in the country providing services in five professional areas-audit, tax, consulting, financial advisory and risk services through almost 500 national and specialized expatriate professionals.

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