PRELIMINARY REMARKS

Reply leverages Data and Analytics to gain insight into the impact of the novel coronavirus on society, consumers and industries. Using the Quentin Search Data tool developed by TD Reply, which aggregates data from Google Trends and Google Ads, this report focuses on how COVID-19 impacts the 2020 Christmas Business in key industries in Europe.

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This report is in no way intended to distract from the fact that the outbreak of the novel Coronavirus
is primarily a human tragedy affecting hundreds of thousands of people.

As the situation evolves rapidly, please note that this page reflects the data collected up until 15 November 2020.

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Christmas 2020 will be unlike any Christmas this century

Christmas in 2019 was a normal Christmas like any other. Christmas 2020 will be very peculiar. With less money to spend, less chances to shop, and less opportunities to celebrate together physically, all of our Christmas traditions will have to change.

2019

588 €

WAS THE AVERAGE HOUSEHOLD SPEND DURING CHRISTMAS 2019

Five percent higher spend than during Christmas 2018.

48%

OF GIFTS WERE BOUGHT IN PHYSICAL STORES FOR CHRISTMAS 2019

Online shopping was growing but high streets still hung on.

46%

OF MARKET POPULATIONS WERE OPTIMISTIC ABOUT THE COMING YEAR

Optimism was higher for individual outlooks than for national outlooks.

Source: Retaildive

2020

-733 €

AVERAGE LOSS IN HOUSEHOLD INCOME ACROSS MARKETS IN 2020

Job losses and furlough work schemes have dented family spend.

-40%

DOWNFALL OF BRICKS AND MORTAR SHOPS IN 2020

For the first time Online Christmas shopping could overtake the physical one.

52%

OF GERMANS PREDICT TO SPEND CHRISTMAS 2020 AWAY FROM FAMILY

Travelling home for Christmas is looking less and less likely.

Source: gfk, youGov

Europe’s Christmas spirit is dimmed

With the hit of the second wave, consumers in Europe are weary of COVID-19 news and messages. Christmas Season can become the positive distraction everybody wants. At the same time consumer interest around traditional Christmas key industries is down and compared to earlier this year, people overall are less enthusiastic regarding the holidays - yet.

CHANGE IN SEARCH VOLUMES, 2019 Vs 2020 (DE, FR, UK, IT)

Data retrieved from Quentin, TD Reply’s Search Data Tool, for the mentioned industry sectors across 4 markets (DE, IT, FR, UK) Feb 1- March 31 2019, Feb 1- March 31 2020; Sept 15-Nov 15 2019, Sept 15-Nov 15 2020

Background data

Up to 60% of Europeans are feeling some form of lockdown related mental fatigue.

Global visits to the Coronavirus page of John Hopkins University have dropped by half in the past 6 months.

Source: Similar Web, WHO

Implications for the key industries

  • Any industry offering services for home living (delivery, e-commerce, telecommunication) will likely grow during the Christmas period.
  • Compared to March and February, impacts of COVID-19 on consumer searches are overall a little less significant – except for topics on Tourism & Hospitality which are decreasing further.
  • In 2021, industries that cater to experiences out of home will be forced to think about how they can make up for losses.

Getting into the holiday mood

Consumers are looking for more in-home and fewer group experiences. The interest in Christmas markets, dinners or holidays are declining. Staying at home once again makes consumers interested in home decoration, home baking and home entertainment. This confers to activities with Christmas references.

30% of Italians plan to give food, candy, or alcohol as presents this year.

70% of French consumers would agree to an extended lockdown till after Christmas, if the health situation required it.

Popular Christmas Markets in Berlin and Munich have been cancelled this year.

95% of companies in London have cancelled their planned office Christmas parties this year.

Sources: BBPA, Le Parisien, Morning Consult

CHANGE IN SEARCH VOLUMES, 2019 Vs 2020 (DE, FR, UK, IT)

Source: Data retrieved from Quentin, TD Reply’s Search Data Tool, for the mentioned industry sectors across 4 markets (DE, IT, FR, UK) Feb 1- March 31 2019, Feb 1- March 31 2020; Sept 15-Nov 15 2019, Sept 15-Nov 15 2020

Implications for the consumer and entertainment industries

  • As consumer interest in Christmas markets, dinners or holidays declines, the hospitality, travel and event industries are facing hard Christmas periods.
  • Conversely, brands selling traditional Christmas products like food, decorations and calendars are likely booming.
  • Consumer interest in Christmas movies is increasing. Likely because it is a way to get into festive mood without group Christmas activities.

More people will shop online than ever before

This Christmas, gift giving is still important to people. The shopping experience continues to shift online. Presents are being looked for and probably also bought online.

Retail e-commerce in Italy is predicted to increase by 5.5bn € in 2020.

19% of French respondents plan to shop early this holiday season, compared to 35% of EU consumers.

47% of German respondents are planning to mail gifts additionally to giving in person

Amazon UK is looking to hire 7k additional workers by end of 2020 to help handle a massive spike in demand.

Sources: Centre for Retail Research, Amazon UK, Morning Consult

Implications for e-commerce and stationary retail

  • Stationary Retail will likely feel a big decrease as the whole process of present shopping is already shifting online.
  • Brands with an infrastructure for e-commerce are likely to benefit as more and more consumers show interest in buying Christmas gifts online.
  • Logistics and delivery services will likely face the busiest holiday season ever as consumers show a huge interest.

CHANGE IN SEARCH VOLUMES, 2019 Vs 2020 (DE, FR, UK, IT)

Source: Data retrieved from Quentin, TD Reply’s Search Data Tool, for the mentioned industry sectors across 4 markets (DE, IT, FR, UK) Feb 1- March 31 2019, Feb 1- March 31 2020; Sept 15-Nov 15 2019, Sept 15-Nov 15 2020

Digital Christmas gatherings and celebration

In order to protect loved ones once again, consumers are less interested in travelling, neither for getaway trips nor for big Christmas gatherings in hometowns. However, the need to be close to each other in different ways remains.

78% of Italians plan to travel less than they usually do in the holiday season.

The airline Air-France KLM has reduced flight capacity by 50% during the Christmas period.

German nursing care authorities are encouraging families to visit relatives in shifts during Christmas to avoid infection risks.

58% of British people plan to spend some or all of their family holiday activities virtually instead of in-person.

Sources: Wall Street Journal, Morning Consult

CHANGE IN SEARCH VOLUMES, 2019 Vs 2020 (DE, FR, UK, IT)

Source: Data retrieved from Quentin, TD Reply’s Search Data Tool, for the mentioned industry sectors across 4 markets (DE, IT, FR, UK) Feb 1- March 31 2019, Feb 1- March 31 2020; Sept 15-Nov 15 2019, Sept 15-Nov 15 2020

Implications for the aviation and transport industries

  • A massive drop in flight interest means hardship for airlines, airports and the travel industry will continue. The impact on this industry in particular, is the biggest overall.
  • While the transportation of people is facing a harsh downfall, logistics services will boom, not only for home delivery but also for sending packages with Christmas gifts and surprises.

Christmas interest in Europe

Consumer interest in Christmas differs between markets. UK consumers are now more interested than in 2019 in decorating their homes as festively as possible, while in France Christmas decorations are not a priority.

CHRISTMAS DECORATIONS CHANGE IN SEARCH VOLUMES, 2019 Vs 2020 (DE, FR, UK, IT)

-29%

IN ITALY

-27%

IN FRANCE

-62%

IN GERMANY

+46%

IN IN THE UK

Source: Data retrieved from Quentin, TD Reply’s Search Data tool, for the mentioned industry sectors across 4 markets (DE, IT, FR, UK) Feb 1- March 31 2019, Feb 1- March 31 2020; Sept 15-Nov 15 2019, Sept 15-Nov 15 2020

2020 CHRISTMAS SPIRIT ALL AROUND EUROPEAN MARKETS

55% of Italians are worried about their ability to buy gifts due to cost or budget concerns

36% of French consumers are planning to shop in malls, compared to 9% of Italians

43% of German shoppers say COVID will impact their holidays, compared to 71% of European shoppers

75% of British respondents said that Christmas will remain important to them in 2020

Sources: Quantcast, McKinsey, Morning Consult

The Christmas spirit remains higher in the UK and DE than in FR and IT.

Brand communication to consumers during Christmas will need to have a special focus on the right tone for their messages.

Stay ahead of the Christmas trends

At home during holidays

Travelling activities during this Christmas season are projected to decline massively, with many people even deciding to skip festivities altogether.

Airlines and hospitality groups alike will benefit from longer-term planning into the spring or summer months.

E-commerce set to spike

Planning ahead for the holiday season amid lockdowns and general uncertainty means that consumers are increasingly shopping online, as well as earlier than in 2019.

Suppliers which can assure and guarantee seamless shipping will capture consumer attention, especially of those with tighter wallets.

Heading to a telecom surge

Families and friends will have a need to connect and communicate despite physical distance over the holidays.

Internet and phone providers need to secure their infrastructural operations.

Services that create novel ways to play and interact remotely will likely win out this season.

Embracing new fashion

Consumer interest in fashion has rebounded moderately from the beginning of the COVID-19 crisis, but the industry should save the feeling of relief for after the holiday season.

Retailers that provide comfortable home wear for watching Christmas movies for example,  may have a more positive outlook this year.