nongrocery retailers in Europe have faced twin challenges: navigating fierce macroeconomic headwinds and a heightened competitive landscape while catering to increasingly selective consumers. On the first count, inflation-adjusted sales have yet to return to 2019 levels in all top European markets, and generalist marketplaces and discounters have ignited a race to the bottom on price and quality. Balancing sustainability with growth poses a dilemma to retailers as margins continue to erode.
This article is a collaborative effort by Christel Delberghe and Anton Delbarre of EuroCommerce and , , , and , representing views from McKinsey’s Retail practice. On the second, consumers continue to exercise caution in their discretionary spending, favoring travel and out-of-home activities. They are also demanding seamless omnichannel experiences and higher sustainability standards, raising the bar for retailers striving to capture their attention and loyalty.
The report focuses on six categories—furniture and furnishings, DIY and hardware, consumer electronics, sporting goods, beauty and personal care, and pet care—across six European countries (France, Germany, Italy, Poland, Spain and the United Kingdom). In preparing the report, we surveyed more than 15,000 consumers across six European countries and about 30 nongrocery retail executives in Western Europe. We augmented these findings with interviews with ten retail CEOs and executives in Western Europe.
Our research combined E.
