By Sarah Montano, Professor of Retail Marketing and Dr Inci Toral, Associate Professor
Birmingham Business School, University of Birmingham
The arrival of a Christmas market in the centre of a local town or city heralds the countdown to Christmas! With the smell of mulled wine in the air, the temptation of a hot dog to eat and Christmas gifts to buy, a trip to the local Christmas market has become as traditional as the tree itself! With twinkling lights and the opportunity to hug a mug of cocoa, whilst wearing your red scarf- you might feel as festive as a Hallmark Christmas movie! It used to be that customers would have to travel overseas to a Christmas market but no more! Now the market comes to the customers!
Why have markets become so popular?
Birmingham hosts the largest authentic Christmas market outside of Germany. The Birmingham Frankfurt Christmas Market (starting in 1997) is perhaps not as old as the first records of a Christmas market in Frankfurt in 1393, nonetheless it has become a tradition to host the market. With an average customer spending nearly £60 per visit and a renewal of the contract for the next 5 years, the market is said to add £350million to Birmingham’s economy.
This year the market was even voted the best Christmas market in the UK! The market not only incentivises customers to spend on its own goods, but it also benefits the city by attracting visitors from far and wide (by car and train, not donkey!) who spend money in local shops and hotels. In fact, Birmingham’s original Christmas market is so popular that 2024 saw several Christmas markets pop up within the vicinity, including a Christmas art market.
Around 4 million people are expected to visit the market, bringing much needed income to a bankrupt council. Christmas markets are not just a West Midlands offering however, they can be found across the whole of the UK, including the Instagram worthy market in York, the party atmosphere at the market in Manchester and Bridgerton vibes in Bath., All are adding value to local economies.
It’s an experience that matters!
A traditional market was always a place to socialise, meet and eat! And nothing has changed. We know that online sales are holding steady at about a quarter of all sales, indicating that customers still want to shop in person.
As customers can default easily to online, retailers are increasingly focusing on offering an experience and the ability to socialise rather than just a transaction, and what better experience than a Christmas market to get you in the festive mood!
Birmingham’s Primark invests in this strategy with its Disney and Greggs cafes for customers to visit in store, a clear indication that “Experience Matters!”.
People will flock to town centres or even farther destinations to feel and experience the magic, and this experience requires collective consumption. In today’s digital lives, collective consumption has a different meaning, such as shared rides, downloadable media, and reviews about products. However, Christmas is, and has always been about sharing the warmth, laughter, and happiness as showcased in Hallmark movies.
Experiential retail meeting points are essential to bring shoppers and consumers together. Come rain or shine, people will go out to feel a magical experience and immerse themselves to the spirit of the festivities. Watching the decorated windows of shops and illuminated streets, indulging in in festive food and drink and meeting with friends are always the talk of the offices, households and classrooms. All these contribute to more footfall and retail spending. Christmas markets possess the enchanting quality of uniting everyone, regardless of whether they celebrate Christmas or not. At a time when people have been concerned about the cost of living, a visit does not have to be expensive, it might just be a walk and a hot chocolate!
SOS by shopping at a Christmas market
2024 has once again been a difficult year for retailers, with The Body Shop and Homebase facing difficulties and we have previously called on councils and governments to SOS and Save Our Shops.
Over this last year, approximately 38 outlets per day have closed down. At this time of year, creating space for a market is a simple solution for town centre managers to get customers into town and ready to spend and there will be a proximal effect on existing retailers. Councils could harness this magic and make the festive streets even more inviting, for instance, reintroduce window decoration competitions and even organise contests among different Christmas markets. These activities can spread the cheer of Christmas markets while boosting visitor numbers for all.
In summary, markets unite people, spread festive joy and community spirit, even amidst the challenges of the year. Christmas markets can be a vital solution for town centres, encouraging footfall and festive spending. So, don your red scarf, wrap your hand around a mug of cocoa and for 30 mins take the time to star in your very own Christmas movie!
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The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of the University of Birmingham.