Summer 2009
Luxury for Less: Holiday Gifts Under $20 Retail By Heather Johnson Durocher

Shop for Frugal Chic

If you are looking for more "frugal chic," visit the summer edition of the New York International Gift Fair, recommends Dorothy Belshaw, NYIGF director and GLM senior vice president. "NYIGF draws influence and inspiration from New York City, the world's epicenter of design and retail," says Belshaw. "It has never been more affordable to attend NYIGF, and our summer offerings - an extensive selection of new suppliers, access to principles of leading manufacturers and unparalleled style and sophistication of resources - make it a must-attend market." NYIGF's many divisions including Tabletop & Housewares, Handmade, At Home, and more will feature a wide variety of affordable products.

For product picks under $20 at the NYIGF, check out Belshaw's guest blog at specialtyretailexpert.com.

The Price is Right

What’s happening at Annie’s is probably happening in your store as well.

It used to be that customers would walk into the gift store in Traverse City, MI, and request that a basket of goodies be put together. That’s hardly the case anymore, says owner Pete Schmitz, whose store sells trademark bulk candies, handmade chocolates and gourmet coffees that are often paired together to make hostess gifts.

These days, if Schmitz’s customers buy a gift basket, they pick and choose the items, to stay within their tighter budgets. Store staff offer suggestions to keep such gift packages under $20, a price point that appeals to shoppers. “It’ll be a quarter pound of our flavored coffee, like our snicker doodle which smells absolutely fabulous, a few handmade chocolates—we’re known for our truffles and turtles—and a bag of candies,” he says. “Packaged together, tied with a curly ribbon, you’re at $20 and that’s a nice, little gift.”

The recession has brought about changes in the way consumers are shopping now. The first of these is the most obvious: They are spending less money. Shilpa Bharne Rosenberry, a senior consultant at New York-based market research firm, WSL Strategic Retail, points out that even if your customer might spend less, she will still spend something, especially on gifts.

Mary Geoghagan, “Chief Relaxation Officer” of Do Not Disturb, an Alpharetta, GA spa product wholesaler, believes the economy won’t ever completely snuff out shoppers’ generous spirits, especially when it comes to thanking those who welcome guests into their homes.

“No matter what happens, people are still going to buy their girlfriend or their friend something,” Geoghagan says. “They’re not going to come empty-handed [to a party]. I don’t care who you are.”

What is the price point that works? $20 seems to work for most. “In our gift purchase research we found that $20 to $25 is the ‘sweet spot’ for gift purchases, especially for gifts for someone who isn’t so intimately close, like a gift for a hostess,” says Pam Danziger, of Unity Marketing in Stevens, PA.

Little luxuries

While it helps to keep an eye on price points, it need not be the only way out, especially for retailers like you who don’t compete on price. Is there anything else you can do to bring those customers in? Emphasize little luxuries, says Rosenberry.

In today’s weak economy, a little bit of luxury in the form of a gift can go a long way. After all, what better way for your customers to relax and keep life in perspective than with a small splurge on something tasty to eat, a smell to savor or other brighten-your-day item? And if they are shopping for hostess gifts, these run the gamut, from candles and gourmet food and coffee, to spa treatments and home accents.

Combined with a lower price tag, these products can be big sellers for you right now, industry experts say.

Pampering, please

Spa products make great gifts—even better they make a statement at an affordable price. Geoghagan from Do Not Disturb suggests retailers price her company’s travel spa kit at $18.50. The kit—”a great gift for someone who travels a lot,” she says—contains a 4 oz. 100 percent soy candle, 2.5 oz. “bubbly” bath gel, 2.4 oz. lavender relaxation bath, body and massage oil.

Geoghagan says the company’s lavender “fortune-cookie shaped” Fizzers, are also very popular. These contain laminated notes featuring words of wisdom and inspiration. The notes float to the top of the bath water as the “fortune cookies” dissolve.

“It’s been huge,” Geoghagan says of the 3.8 oz “fizzers,” which are packaged in threes in a decorated Chinese take-out box. It retails between $15 and $18. “It gives customers a smile at the end of a long day. It’s absolutely a hoot to sell.”

Sweet Grass Farm, a Greenland, NH wholesaler of “eco-friendly, useful and affordable products for everyday life,” also has found success with a line of pampering products. Keeping prices low has always been a goal, says Sweet Grass Farm creator Debbie Ludington.

“Our product line has fared well through this whole business downturn because of the fact that we have always kept our price points at the everyday affordable range,” she says. “This has been our primary mission since the beginning and we offer premium scented and premium performance goods that people can actually afford to use. So, instead of paying $12.95 for a dish soap in this category and then only placing it out when company comes, our dish soap, at $6.95, can be used every day.”

From the company’s bath and body line, the hand-stirred soaps, at $4 a piece, are made of vegetable oils, spring water, pure essential oils, herbs and nutrients. These are available in 13 scents.

Home sweet home

Your customers may waffle about what to buy when it comes to gifts for the home. After all, homeowners’ tastes can vary greatly. But modern, country or vintage in style, the Abbott Collection features home items that fit with nearly any décor, says Stephanie Teixeira, of the Toronto, Canada wholesaler.

Within the $20 range, Teixeira suggests the company’s best seller, an Italian “glass-look” paté spreader. The nickel-plated spreader comes in four styles and retails for $20.

The Abbott Collection has beefed up its line of reasonably priced gift items in recent months. “We did have a line of more high-end products, but basically the timing is not great for that,” she says. “So we’re going back to making sure we’re addressing everyone’s needs—nice-looking goods in a more moderate price range.”

Ornamental yet functional, the company’s kitchen stirrers and picks, which come in a set of four, are faring well. Other popular items: a high-clarity, red-rimmed German glass bowl with a retail price of $20, flavored salts packaged jars for $9 and glass starfish-shaped plates made from recycled materials for about $10.

To make housework a bit more appealing, Sweet Grass Farm offers a shea butter lotion ($9.95 for 16.9 oz.) and Liquid Soap ($8.95 16.9 oz.). The richly fragrant lotion, containing shea butter and olive oil, is suitable for hands and body. 

Other fun yet inexpensive gifts include magnet sets from Kate Grenier Designs in Portland, OR. The magnets made from recycled bottle caps, are available in gift packs for easy gift giving.

Special ‘treat’-ment

Gourmet coffees and chocolates, handmade candies, even locally produced products like salsas and jams, make for delicious gifts. Patti Abbott, co-owner of wholesale/retail treat company Graffiti Zoo, believes something tasty makes the perfect hostess gift.

“Everybody wants something to make them feel good, a little pick-me-up,” says Abbott, who recently took over the Conyers, GA Company. “Even in these tough economic times, everyone can spend a couple of dollars for a piece of chocolate for a good little treat.”

Graffiti Zoo’s tag line is “where the animals feed you,” and on each box is a story of a different animal. Some of the company’s profits benefit the Conservation Endowment Fund of the American Zoo and Aquarium Association.

Boxes of these animal-named treats—”Margarita Manatee,” “Bohemian Tree Frogs,” and “Zanzibar Racing Snails” to name just a few—vary in price, from $1.99 for a .9 oz size to $7.99 for six ounces. The “Trinidad Sea Turtles,” ginger snap cookies covered in lemon-flavored white chocolate, is the latest addition to the product line.

Merchandising moves goods

Barbara Grudzien, manager of Douglas Cosmetics in Westport, CT, successfully sells a line of Do Not Disturb spa products by posting information near the product displays. Emphasizing the items’ low cost and high quality entice buyers to take a closer look and buy, she says.

Ludington suggests tabletops with multiple layers of height, even cake and plant stands or baskets or barrels, as effective ways to merchandise products.

Looking outside your store can be a smart marketing strategy, says Geoghagan, of Do Not Disturb. “You have to be more creative about going out to get the customers,” she says. This can mean reaching out to local realtors or travel agents, who like to offer small gifts to their clients. Connect with a few of these professionals to sell a large quantity of gifts, Geoghagan recommends.

At Annie’s, customers are offered free samples of the gourmet coffee for sale. Another way Schmitz keeps shoppers in the store browsing longer and buying product is making use of video supplied by vendors. A small television set sits on a counter near the candy and chocolate case, providing customers demonstrations of different gift items and background information on various delectables.

“It leads to conversation,” Schmitz says. “Then we can ask one of the questions we ask of customers: ‘Are you putting together a gift?’ And we try to have at least three suggestions to give to a customer.”

Annie’s and others have found that in this economy, it makes sense to emphasize small luxuries at reasonable price points. The phrase that Kate Grenier of Kate Grenier Designs says of her company’s products seems to be the hook that will draw reluctant customers in: “champagne taste on a beer budget.”

Mouse over images below to view.

Heather Johnson Durocher

Durocher is a northern Michigan-based journalist who writes frequently about business for newspapers and magazines. She has contributed to USA Weekend, Woman's Day, Parents and American Baby. Visit her website at HeatherDurocher.com




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