GIFT SHIFT Analysts say shoppers are changing their holiday spending
More Americans are switching from ordinary gifts to intangible, experiential gifts.
KNIGHT RIDDER NEWSPAPERS
Dianne Canaff is bracing herself for an onslaught of last-minute holiday shoppers. Last year, on Dec. 24, the lines where she works stretched out the door.
Canaff doesn't work at a mall. She works at Hackensack University Medical Center, where she manages the Beyond Day Spa. Today she expects to be doing a brisk business in gift certificates for facials, massages and manicures.
In the offices of Jet Aviation at Teterboro Airport, the phones have been ringing all month with customers buying $50,000 and $100,000 gift cards for private jet travel.
And at the Chef Central store in Paramus, N.J. one of this year's hot sellers doesn't fit in a box or on a shelf. It's a private cooking class for six people.
Gifts of air travel, massage and cooking classes are examples of what some retail analysts are calling a seismic shift in Americans' holiday spending habits. More and more Americans, the analysts say, are switching their holiday spending from traditional "stuff" like toasters and sweaters to experiences.
Wave of future
Specialty retail consultant Annette McEvoy calls the trend "the gift shift" and says it's the wave of the future. She defines it as "the shift from ordinary gifts to intangible, experiential gifts."
McEvoy says shift gifts -- whether a gift certificate for a dinner or a trip around the world -- are the fastest-growing segment of the holiday gift market. She cites federal statistics showing that while apparel, home goods and jewelry sales have stayed relatively flat between 1993 and 2003, education gifts, health care gifts and monetary gifts (in the form of gift cards and cash) have soared.
"Demand for shift gifts is outpacing supply," she said. "New gift markets and products are developing, and consequently there are opportunities at retail."
"I think the baby boomers, particularly in the very affluent areas, have enough stuff," said Ian Landry, who in October launched a Washington, D.C.-based gift Web site, excitations.com. "What they don't have enough of is time, and when they do have time they want to do something that makes an impression."
His Web site offers people living near the nation's capital gift packages for everything from Potomac cruises to "secret agent driving classes." The experience gift packages also are sold from kiosks at two D.C.-area malls.
He plans to expand the concept to other metropolitan regions, with the New York/New Jersey region tops on the list for his next location.
Landry, who became a multimillionaire when a company he founded was sold to Cisco, said he got the idea for experience gift packages in his native England, where such gifts are offered by virtually every retail outlet. "You can buy experiences in the post office in the U.K.," he said.
Something in return
Another attraction of shift gifts like trips and theater tickets is that the giver often gets to participate in the gift -- for example, a grandmother who takes her children and grandchildren on a cruise.
"When you give your husband a sweater, the sweater is your husband's," Landry said. "If you give him an overnight llama trek for two, with a romantic dinner, you get to go, too."
RedEnvelope.com, the upscale online and catalog retailer, is selling gifts that, for $20 to $30, combine an IOU card for a trip, a dinner or a day of golf with a small token gift like a pair of martini glasses or a travel journal.
Kristine Dang, executive vice president for merchandising at RedEnvelope.com, said the company launched the concept for Mother's Day and has been so pleased with the response for Christmas that it will expand it to Valentine's Day.
Retail consultant McEvoy is telling her traditional retail clients that they can profit from the "gift shift" by pairing experiences with the products they sell. A fragrance company, for instance, could offer "a visit with the perfumer, and sell that behind the counter instead of just the bottle of fragrance," she said.
Chef Central owner Ron Eisenberg said he had shoppers' appetite for experiences in mind when he built his Paramus store with a large demonstration kitchen in the center. Cooking classes, tastings and "meet-the-chef" experiences are as important in drawing people to the store as the upscale cookware and gourmet foods on the shelves. "We know the store has to be an experience," he said. "When you're small and you're trying to compete you have to make it different."
The store's $300 cooking-class package for six, which includes a $100 gift certificate, generally sells out every time it is offered, he said.
Making memories
John Bertucci, a sales and marketing executive with homes in Manhattan and Asbury Park, has been giving "experience" gifts for years. He's surprised his mother on Christmas morning with tickets for a mother-son Caribbean cruise the next day. He took a sister to Germany and Switzerland for her 50th birthday, and he has given his nieces and nephews family beach vacations and ski trips for Christmas.
Bertucci doesn't call his presents "experience gifts." He calls them "making memories" and says his habit was inspired by his Aunt Anna, who used to take him and his siblings on trips when he was a kid. "She said to me it's all about making memories," he said. "How everybody remembers you in life is the times you spend with them as opposed to just sending them an expensive gift."