As Christmas nears, more shoppers across Asia are sending their yuan, yen, won or ringgit across borders, often choosing to buy their presents abroad through websites, rather than paying expensive surcharges or taxes in their home markets.
This spells trouble for brick-and-mortar retailers that are continuing to experience growth, albeit at a slower rate, but find that competition is increasing and margins harder to come by, even as the Christmas shopping season gains more importance.
"Christmas is another excuse to shop," says Matthew Crabbe, director of research for Asia Pacific at the Mintel Group.
Yet Christmas still trails the lunar new year holiday, which is celebrated across much of the region, in terms of consumer spending.
This can be seen in Thailand, for example.
"As most Thais are Buddhists, the Christmas season appears to have a moderate influence on spending but the New Year holidays are another story," says Sasikorn Charoensuwan, head of Research Department at Phillip Securities in Thailand. "We see the Christmas period as a mere support on sale performance in the Asian region, except for Singapore."
She says that spending amounts for 2014 look likely to be similar to that of the last year. "At end-2013, Thailand had been clouded with political tension and this year is currently facing a sluggish economy."
In places like Singapore and Hong Kong, Christmas is already a key event, and shopping in this season is a bigger event in Japan and South Korea than it is in the Chinese mainland.
Nevertheless, in most places across the region, Christmas retail sales are starting to gain traction, even if the sales on offer may just be tempting Asians to dip into their wallets to get their shopping done ahead of the Chinese New Year holiday.
"There is some evidence that Christmas is a good time for people to shop for Chinese New Year presents," says Crabbe. "Christmas has been increasing in significance each year, but it is still less important to the China retail calendar than it is for other countries."
The growth of retail spending is likely to continue this year, albeit at a slower pace as the rate of economic growth in China and much of the region continues to slow or be hit by new taxes or higher costs. The impact of higher costs on both business and consumers are visible across Asia as 2014 draws to a close.
The higher costs are putting a twist on traditional Christmas shopping, whether at physical retail stores or online. More and more shoppers are taking to cross-border shopping.
In Asia, this growing trend may be most visible in South Korea, where the number of people who shop for Christmas presents through online sources outside the country is rapidly rising.
In 2013, South Koreans spent more than US$1 billion (S$1.32 billion) through foreign retailers, up 47 percent from 2012, according to customs data. Hyundai Logistics, the freight and parcel delivery arm of the Hyundai Group, expects this figure to rise to 60 percent this year.
In China, a little more than a quarter of all online shoppers spend their money overseas, according to research by PayPal and polling firm Ipsos.
China is the best market for US merchants as buyers look for ways to get around duties, taxes and similar charges. About half of the Chinese consumers surveyed said they planned to spend more internationally this year. This represents the third largest projected growth to date.
Currently, just 26 percent of online shoppers in China are going global. This is in stark contrast to, say, Austria, where cross-border shopping is very common. The European country boasts 83 percent of online shoppers turning to offshore retailers.
But the potential growth among consumers in China is likely to be much faster, given the country's huge population compared to Austria, whose population is just 9 million.
"By identifying trade opportunities around the world, our research findings can help merchants tap into the expanding global marketplace," says Anuj Nayar, senior director of global initiatives at PayPal.
Cross-border shoppers, who do 10 percent or more of their online spending using overseas shopping sites, now buy twice as much as domestic consumers in the United States, according to PayPal and Ipsos.
However, the growth of international shopping is not doing much to shore up retail growth in Asian markets. Although still expanding relatively fast, the speed of growth has been falling short of targets over the past two years.
In China, retailers are still finding ways to deal with higher rental and labour costs alongside rising competition from e-commerce providers. Retail sales in the mainland rose 12 percent between January and October over the same period a year earlier. The government had expected a 13 percent increase.
"There's no sign of improvement in the fundamental factors of the retailing sector," said BOC International analysts Liang Jiangze and Tang Jiarui in a note.
The pair listed a number of trends for China's retail market in the coming year. These include the beginning of a phase of acquisition and consolidation, a cooling off in the price competition among online retailers, a push toward the diversification of sales channels, lower rents for commercial properties and the collapse of some shopping malls around the country.
"The chances of retail market recovery lie in the reform and consolidation of the industry," Liang and Tang said.
In Japan, consumers are expected to spend 5 to 8 percent more this Christmas season, thanks to a new sales tax that the government put in place in April.
In Hong Kong, retail sales dropped 0.2 percent in the first 10 months of the year, according to the Report on Monthly Survey of Retail Sales by the Census and Statistics Department. There are fears that the protests that blocked parts of the city from September through to the second week of December could drive down that number further.
In Singapore, online shopping is finally taking root after years of resistance. PayPal expects e-commerce to grow 13 percent by 2018 from the US$2.99 billion that online shoppers are projected to spend this year.
This could pose a problem for retailers, who will have to cut overhead costs and streamline their offerings to compete better.
In Malaysia, Christmas shopping could have a bumper year as shoppers spend ahead of the goods and services tax (GST) that will be implemented in April next year, according to the Malaysian Institute of Economic Research.
"In terms of spending plans, consumers are prepared to go shopping for big-ticket items, encouraged by the scheduled implementation of the GST," the institute noted in its economic outlook for 2015. "In fact, buying plans for cars, furniture, washing machines, TVs, refrigerators and cookers were up in the recent quarter."
These plans could help overcome the impact of a beaten-down consumer sentiment index, which has been battered by expectations for inflation and fears of lower incomes.
"This will intensify competition in the market," says Crabbe from Mintel. "Retailers and brands are becoming more innovative to capture consumer interest. Christmas will be part of that competition for attention."