2026 European Holiday Shopping Outlook

Will this holiday season deliver growth?

Bain expects the UK to lead European holiday sales growth this year at 3.5%, although mostly inflation, rather than volume, accounts for the gain. Growth in France and Germany will be more subdued, at 2.5% and 2.0%, respectively.

A muted mood heading into the holidays

Headwinds are overpowering tailwinds across the region. Even so, the desire to feel festive will support the modest growth in sales:

• UK. Inflation, already at 3.1%, could climb to 3.8% by year end. Rising unemployment and declining vacancies are deepening job security concerns. Consumer confidence remains low as a result. The wildcard is the autumn budget: If targeted at the cost-of-living crisis, it could lift holiday spending.
• France. Inflation is creeping back off a low base, and unemployment is rising, straining purchasing power. The approaching presidential campaign and changing effective tax rate, particularly for upper-income households, add to the uncertainty. But French households are sitting on high savings. After a cautious year, shoppers may be ready to indulge this holiday season, especially when it comes to grocery.
• Germany. Amid continued political uncertainty, higher unemployment, and higher mortgage rates, consumer confidence remains low. Purchasing power is the one bright spot: Wages are growing 4.1%, outpacing 2.8% inflation and lifting disposable income. The real test is whether shoppers will spend that extra income on discretionary items, as energy costs are squeezing household budgets again.

Where shoppers are spending

Across the UK, France, and Germany, some retailers, including health and personal care and pure play e-commerce, are more likely to see growth. But even in winning categories, most gains will come from higher prices from inflation rather than volume.

UK France Germany

• UK
• France
• Germany

Where shoppers plan to buy

Most UK consumers will do their holiday shopping online, whereas French consumers are more likely to rely on brick-and-mortar, with 34% doing all or most of their shopping in stores.

Amazon, search, or AI?

Amazon leads across markets, with shoppers nearly twice as likely to go there as other retailers’ websites. However, generative AI platforms are carving out a real, if still niche, share of discovery. Gen Z is powering the shift, with nearly half starting on generative AI platforms, about six times the rate of baby boomers and older.

Five ways retailers can win over European shoppers this season

• Show up where shoppers start the search. Shoppers stuck on what to buy, especially for gifts, are often turning to AI first. Showing up in the AI-generated consideration set is starting to matter nearly as much as getting shoppers into stores. Leading retailers will ask: Is our product content structured and readable enough to appear for top seasonal prompts and categories? Are there ways we can quickly audit and clean our data in the next few weeks?
• Treat the season as a dynamic campaign. Winning the big sales days is only part of the game; showing up early can help win the rest. But the shopper browsing early in November is nothing like the one panic-buying three days before Christmas. Retailers that evolve their assortment, promotions, and messaging at every stage of the season will snag more sales. Pair that with modern customer relationship management and personalization, and they’ll stay top of mind, capturing more of shoppers’ spending and loyalty long after the holiday lights come down.
• Make value real. Price sensitivity is extraordinarily high heading into the holidays, and AI makes it easy to compare or spot a discount that isn’t real. Retailers that can demonstrate value and show their deals are genuine, not manufactured for the big days, will earn the trust of increasingly skeptical shoppers.
• Invest in flawless execution. Delivery timing, stock availability, and site security carry outsized weight in November and December. A late gift or inaccurate inventory online hit harder than at any other time of year. Shoppers remember the retailers that deliver on their promises. They’ll remember those that don’t, too.
• Believe and reward. Consumers are feeling anxious, and retail leaders aren’t immune. Real leadership conviction that growth is possible sets a tone that trickles down from the top to frontline teams. Critically, those employees create the holiday magic that compels consumers to open their wallets—especially when they’re rewarded for delivering results. 

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The authors would like to acknowledge Christian Fenner, Jonathon Ringer, Sophie Horrocks, Xavier Bersillon, Megha Dasgupta, Sakshi Goyal, Shivali Srivastava, Sanket Waghmare, Falya Malik, Shaurya Singh, and Anshika Gupta for their contributions.