By Eva Kuehnen
FRANKFURT, Dec 11 (Reuters) - The majority of European consumers plan to cut spending next year by an average of 12 percent as concerns about the impact of the financial crisis grows, a survey showed on Thursday.
Vacation travel, dining out and consumer electronics are among the top items people would spend less money on, according to a survey of 2,700 European consumers by Boston Consulting, which Reuters obtained exclusively ahead of publication on Friday.
"This downturn is shaping up to be different than the ones that we have seen in the recent past -- deeper and longer lasting," said Catherine Roche, partner and managing director at Boston Consulting Group.
"It is simply the layering of the effects here that is unique," she said, pointing to the collapse of the housing market in countries like the United States and Britain, the credit crisis, steep declines in stock market values and the slowdown in the real economy on top of it.
"It's a powerful one-two punch."
About 56 percent of consumers in Germany, France, UK, Italy and Spain said they would cut discretionary spending next year by an average 12 percent. In 2007, 36 percent had such plans.
The European consumer survey mirrors similar findings in the United States, published in November, where nearly three out of five Americans said they would spend less next year overall.
FINANCIAL INSECURITY
Consumers worldwide are holding back on spending, unsure about how much worse the economic situation can get.
The survey showed about 47 percent of European consumers expected the economy to get "even worse in 2009" and about a third felt financially insecure, more than last year, while 46 percent of participants said they expected to be saving more.
Governments and retailers around the world have introduced measures like tax cuts and shopping vouchers as well as offering massive discounts to get consumers back into a spending mood.
The European Central Bank also cut its benchmark rate by 75 basis points to 2.50 percent last week, the largest it has made since the euro zone's creation almost a decade ago.
But so far, consumers seem unimpressed. About a third of the survey participants said they planned to already spend less this Christmas shopping season.
"It's turning out to be a very disappointing holiday season for many U.S. and European retailers," Boston's Roche said.
While leading discounters were benefiting, retailers that were not as credible on the front of value-for-money were suffering this year. "I really think it could be make-or-break for many retailers," Roche added.
HOW TO SURVIVE
"Survival (of retailers and manufacturers) is going to be dependent on the ability to communicate a compelling message to consumers that goes beyond merely discounting prices," she said.
In Britain, for example, retail sales fell at their sharpest annual pace in more than three years in November, a survey by the British Retail Consortium showed on Tuesday despite extensive heavy discounting.
Consumers were going to be "a lot more selective, a lot more open to doing the leg work to weed out the best deals". But they were also still prepared to spend extra on fresh and high quality food, Boston Consulting's survey showed.
"Green is also still very much on consumers' mind sets. Willingness to pay price premiums for it, however, is very limited," Roche said. (Editing by Andy Bruce)