What is the current state of the retail sector in Europe?
The year 2024 was marked by contrasts across Europe, including the retail sector. While some economies showed signs of recovery from past crises, others remained stagnant or even contracted. Inflation, geopolitical tensions, and demographic shifts shaped the broader economic landscape, directly influencing consumer behavior and retail dynamics.
This study aims to shed light on the development, risks, and opportunities shaping retail in Europe. It offers meaningful insights into key retail indicators such as purchasing power, retail turnover, retail share of private consumption and inflation.
Additionally, a dedicated chapter explores regional purchasing behavior across generations – highlighting how demographic shifts are reshaping consumer dynamics. As Baby Boomers exit the workforce and Gen Z enters it, earning income and forming households, a generational divide emerges that will significantly influence retail trends.
This study highlights how the retail sector in Europe has developed.
In addition to well-founded brief analyses, the 24-page PDF also includes numerous maps and charts that present the content and data in a clear and comprehensible way.
Some key results at a glance:
Purchasing power
In 2024, purchasing power across Europe continued to grow, albeit at a noticeably slower pace than in the two previous years. The average per capita purchasing power in the EU reached 21,008 euros, representing a nominal increase of 3.0 percent compared to revised 2023 figures. In total, residents of the 27 member states had approximately 9.5 trillion euros at their disposal for expenses.
Retail turnover
After a robust 5.5 percent increase in 2023, the growth rate of retail turnover in the EU moderated to just 3.0 percent in 2024, reflecting a broader normalization of consumer behavior and market dynamics following the post-pandemic recovery. The strongest gains were recorded in Eastern Europe, led by Romania (+14.9 percent). In contrast, Estonia saw a 1.3 percent decline, largely due to political uncertainty and rising consumer skepticism.
Retail share of private consumption
The share of consumer spending in the EU that goes to retail has been steadily declining for three years. In 2024, only 32.6 percent of total private consumption was spent in the retail sector. Among all EU member states, Croatia leads with a retail share of 48.0 percent. Germany ranks last, with only about one in four euros of consumer spending going to retail.
“Retail remains a central component of consumption in the EU, even as its share continues to decline. Consumer confidence has remained fragile since the pandemic, with many Europeans concerned about their country’s economic outlook. Inflation, rising living costs, and climate change rank among the top concerns and are driving more cautious spending behavior.”
— Philipp Willroth, Study Lead, NIQ Geomarketing
Inflation
After sharp price increases in recent years, inflation across the EU showed further signs of stabilization in 2024, averaging 2.6 percent. The highest rate was recorded in Romania (5.8 percent), followed by Belgium (4.3 percent) and Hungary (4.0 percent). At the other end of the spectrum, Lithuania reported the lowest inflation, at just 0.9 percent. The 2025 forecast for the EU is 2.3 percent.
How generations shop
Across Europe, generational differences in consumer behavior can be observed. Generation X (ages 44–59) holds the highest purchasing power and is relatively open to trying new products. Millennials (28–43) favor at-home experiences such as cooking and entertainment, reinforced by the pandemic. Generation Z (under 28) is highly convenience-driven and frequently purchases food-to-go. Baby Boomers (60+) remain the most cautious, opting for private labels, focusing on essentials, and making purchase decisions based on promotions to save money.
