As Christmas approaches, the shopping frenzy invades Lausanne, but the atmosphere is more sober. A study by Ernst&Young and the Swiss Retail Federation reveals that a majority of Swiss people are reducing their gift budget due to the rising cost of living.
On the Place de la Palud, in Lausanne, the atmosphere is lively: passers-by wander around, their arms loaded with bags. However, behind the smiles of onlookers lies fiscal prudence.
“Maybe 100 francs per person, no more than 500 francs in total,” confided a Lausanne resident on Monday in La Matinale de la RTS. “Compared to previous years, it’s lower, clearly.”
L’étude d’Ernst & Young reveals that on average, each Swiss will spend 282 francs on Christmas gifts this year. This amount is stable compared to 2023, but it remains far from the 343 francs of 2022, the year when spending reached a record level.
Budget reduction for a majority
Among those surveyed, 51% said they wanted to “slightly” or “considerably” reduce their spending in the run-up to the Christmas holidays, citing high prices. Around 18% even want to “significantly” lower their budget on this occasion. And 45% want to spend as much as at the end of 2023, while 4% want to spend more.
A development that Melissa Kerr, co-founder of the jewelry brand TerraGemma, also notes. “Jewellery remains an easy gift, but customers are spending less. […] As soon as we make promotions on our site, orders increase. Inflation clearly has an impact,” explains the Valaisanne who is participating in the Bô Noël market for the second consecutive year.
Among the most sought-after gifts are vouchers, toys and clothing.
Return of department stores
Faced with economic pressure, consumers are adopting different purchasing strategies. “This year, we are doing a surprise Santa: one gift per family. We prefer to buy a single quality gift rather than several small ones,” says a passerby.
This quest for simplicity is accompanied by a growing preference for stores. According to Ernst&Young, online shopping is seeing a decline in its forecast market share to 37%, while shopping malls and department stores are increasing their forecast market share to 29%.
And for 70% of consumers, sustainability is also important when Christmas shopping, regardless of age and income.
Geopolitical uncertainty
Beyond financial considerations, another factor weighs on purchasing behavior: geopolitical uncertainty. The war in Ukraine, political tensions in Europe and the election of Donald Trump in the United States are among the events that fuel widespread caution.
In Switzerland, inflation marginally rebounded in November to 0.7% year-on-year, falling significantly compared to the surge in consumer prices last year. However, prices for goods and services remain at their high levels and are not decreasing.
For next year, economists expect inflation to be between 0.4% and 1.0%.
Valentin Jordil/ats
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