Contact: Oriana Pound
Deloitte
Director, EMEA Marketing & Communications
+44 20 7303 5055

London, November 25, 2004 — With a negative economic outlook prevailing across Europe, consumers in key European markets will employ smart tactics to ensure that they get the best deals for their Christmas gift shopping, according to Deloitte's sixth annual consumer survey of Christmas spending.

Based on responses from almost 4,000 consumers across seven EU markets, anticipated European average Christmas spending is down slightly for 2004 to €725 from €752 in 2003. Average gift spending will be around €320, compared with €346 last year. Significant differences are, however, evident from one country to the next. The survey identified four key consumer trends:

Consumers still cautious about spending in 2004  Most countries surveyed remain negative about the current economic outlook, except Ireland and the United Kingdom. French, Dutch, Belgian and Italian consumers are particularly negative about their country’s economic environment. In the meantime, mixed feelings prevail in Europe about the economic outlook for 2005. Overall, a small majority of Europeans surveyed are positive about the future, led by the Irish who are by far the most optimistic: 85% expect a more positive economic outlook and nearly 50% expect household income growth. Since anticipated household income is the main driver for Christmas spending throughout Europe, the year-end shopping may be impacted. In contrast, the available spending budget this Christmas is lower than last year in several countries, notably in Germany, the Netherlands and Italy. The survey shows budgets will increase in the United Kingdom, Ireland and Belgium.

Smart shopping to get the best deals  Consumers across the countries surveyed will wait until the last minute to decide where to shop in order to benefit from larger discounts, which they expect to be as high as 20%. They will shop around more than last year in order to get the best prices. Close to 85% of shoppers will use the internet to research products, stores and compare prices, although only 58% will actually buy their goods over the internet. As a consequence, fewer stores will be visited, particularly in Germany, France, Italy and Belgium. Furthermore, some 45% of consumers surveyed will use loyalty points for Christmas shopping, with 40% of these using more loyalty points than last year. Across the seven countries, gift certificates show strongly this year, taking the top spot on consumer wish lists in Belgium and the Netherlands and second place in the other countries.

Generation X leads the way in optimism for Christmas spending  The difference between the spending intentions of different generations became more visible this year, with Generation X ( ages 25 to 40) proving to be the most optimistic in their outlook, with increased spending power on last year: a 26% increase on average throughout the countries surveyed. Generation X spending plans are matched by an increased willingness to borrow money to fund their Christmas spending, with nearly 10% of this group prepared to take out a loan for this purpose.

2004 top gifts  For adults, clothing enjoys a return to the top five, with DVDs, CDs and books high on lists of both gifts consumers want and what they are likely to actually receive. Cosmetics and fragrances will be among the best sellers, as well as gift certificates, fourth on the wish lists for adults across Europe.

Commenting on the survey results, Gilles Goldenberg, Deloitte partner in charge of the Consumer Business industry tgroup for Europe said: "With many consumers still to decide on what gifts they will purchase and an increasing focus on getting the best deals, retailers have an opportunity to secure sales up until the last minute by offering the best value for money and by focusing their offer on the seemingly affluent Generation X."

About this survey
The Deloitte 2004 Christmas Survey, which is designed to measure consumer Christmas spending expectations, has been conducted by Deloitte in November each year since 1998. This year's survey polled 3,799 consumers across seven EU markets (France, Germany, Italy, Belgium, Ireland, the Netherlands and the UK), comprising a representative sample of the population. It was conducted on the Internet by an independent research company.

NOTE: PowerPoint slides summarizing the survey data are available upon request.

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