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Doug Krizner: Holiday gift-giving is usually an opportunity to give loved ones things that special thing they wouldn’t buy for themselves. But consumers are prudently rewriting the rules of gift-giving this year. Andrea Gardner explains.
Andrea Gardner: It’s the afternoon rush at a Trader Joe’s grocery store in Pasadena, Calif. Customers aren’t just putting their produce and frozen pizzas on the conveyor belts. They’re also buying gift cards for the holidays.
Nationwide, Trader Joe’s gift-card sales are up 20 percent over last year. With the economy slowing down, holiday gift givers are thinking more practically this year, says Marketing Chief Jon Basalone.
Jon Basalone: The customers are telling us that they’re very aware that their expenses are up. And they want to make sure that the gift card they’re giving and the money they’re spending is going to be put to use.
Consumers tend to hold on to gift cards for things like clothing and CDs, and monthly fees drain them over time. But gift cards for everyday needs like groceries and gasoline are spent quickly, and becoming more popular.
That’s attracting newcomers to the $30 billion holiday gift-card game. This year, Visa joined forces with an insurer on a health care gift card to pay for medical exams and co-pays. Jiffy Lube is marketing the gift of the oil change.
Candace Corlett is a shopping analyst with WSL Strategic Retail:
Candace Corlett: There are smart marketers in all of these companies who are now looking at the gift card and saying, “Why not me? Why not an oil change?” And the good news is, people need more practical things.
They also want less stuff. Corlett’s research shows that Americans shopped heavily over the last six years, and are now looking to simplify their overstocked lives. What’s emerged is a consumer Corlett calls “the prudent shopper.”
Corlett: And she’s saying, “If I already have four cashmere sweaters, I’m not going to give two more of them. I’m going to look for something that people really need, and say, ‘Oh, thanks a lot, I needed that.'”
In Los Angeles, I’m Andrea Gardner for Marketplace.