By Petra Strobl, Germany Head of Communication and Marketing for Licensing International

The German market presents a strategic paradox for brand licensors and retailers. Historically, Germany is the undeniable birthplace of modern discount retail, with the pioneering model—initiated by giants like ALDI—spreading globally. This heritage has bred a culture of intense price competition, often earning Germans the reputation as the “world’s best bargain hunters.”

This reality is amplified today. Despite economic improvements, consumer apprehension remains high, with current fears over rising living costs driving persistent price sensitivity. The high consumer demand for value-driven shopping is clear—up to 58% of consumers planned to increase their use of price comparison portals in 2025, according to consulting firm Oliver Wyman.

This environment has propelled specialized non-food discounters—such as Action in physical retail and online giants like Temu and Shein—to rapidly gain ground.

For brands operating in this fiercely competitive arena, the temptation is to prioritize the price tag above all else. This, however, is a strategic mistake.

Because German consumers are willing to spend when the value equation transcends cost. The key lies in transforming the traditional Point of Sale (PoS) into a Point of Emotional Experience (PoE).

This strategic shift is driven by consumer demand. Up to 78% of shoppers cite a cohesive and engaging shopping atmosphere as a key differentiator when choosing physical retail over eCommerce, according to a retail study from Zukunft des Einkaufens.

The maximum price a customer is willing to pay is highly context-sensitive, meaning an elevated, emotional experience justifies a higher price point. Brands that focus on quality and innovation consistently maintain their strength even amidst volatile economic pressures.

This is where licensed brands and imaginative retailers hold their unique leverage. By leveraging brand collaborations and in-store experiences, brands can tap into the non-price attributes that drive premium consumption. This includes quality, innovation, and subjective enjoyment.

Retail concepts like Sostrene Grene, which recently opened its 100th store in Lüneburg, Germany, consistently draw big audiences by offering a multisensory, ‘treasure hunt’ environment that fosters emotional connection. Similarly, the global phenomenon of POPMART demonstrates the immense purchasing power unleashed when collectibles and blind-box discovery become a shared, emotional retail ritual.

These examples prove that consumers are not merely seeking the cheapest item, they are seeking moments of excitement and genuine brand connection that the physical, haptic environment provides.

The strategic imperative for the brand licensing industry is clear: be courageous. Do not let the legacy of the German discount market dictate your premium strategy. Instead, view the physical retail space as a blank canvas for emotional storytelling.

By investing in authentic, emotionally engaging brand experiences, licensors and retailers can successfully detach from the relentless race to the bottom and unlock genuine, profitable consumer spending. Customers are ready for the experience and it is time for brands to embrace this shift.

Photo Credit: Vitaly Gariev