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Retail Industry Updates

Why ‘Guilt Gifting’ Will be Popular This Holiday Season

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’Tis the season of … guilt gifting.

That’s right. Because more people will miss in-person holiday celebrations this year due to the continued spread of the coronavirus, they will make up for that by buying gifts for the people they would have visited, according to a new report from market researcher The NPD Group. Oh yeah, they will look to splurge on their own needs as well.

Port Washington, N.Y.-based NPD also reports from its recent holiday purchase intentions study that the bigger ticket items that supported new homebound living and drove general merchandise sales since the pandemic began are likely to continue to stimulate holiday retail sales. NPD found that three in 10 holiday shoppers are planning to spend more than last year because they have fewer expenses related to activities like dining out and travel. In addition, 40% of consumers indicated that, as a result of COVID-19, they will buy more gifts to bring joy during these challenging times.

“Splurges on both guilt gifting and self gifting will be significant components of the consumer’s retail therapy during holiday 2020,” said Marshal Cohen, NPD’s chief industry advisor of retail. “While the emphasis will continue to be on items that are useful to the consumer’s new way of life, the holidays are likely to prompt upgrades to up the ante on many of those practical purchases.”

Quarantine favorites related to people’s virtual at-home lifestyles — like monitors, PC headsets, USB cameras, sleepwear, hair care, air fryers and soda machines — that have sustained growth month after month since March are likely to remain on consumer must-have lists, NPD said its research revealed.

Early promotion winners from the week ending Oct. 17 (Amazon Prime Days, Target Deal Days, etc.) also provide an indicator of continued trends driving what will be hot for the holidays. Those products include robotic vacuums, toy building sets, smart doorbells, fashion dolls and accessories, smart watches and fragrance sets.

More than 40% of holiday shoppers will be shipping most of their gifts because they won’t be seeing family and friends as a result of COVID-19 precautions, a factor that will prompt increased spending related to guilt gifting and make way for gifts that are easier and less costly to ship, NPD stated.

Gift cards will be more popular this year, with 53% of consumers planning to give them as holiday gifts, up from 45% last year. While “experiences” are currently limited as far as gifts go, there are some other intangible gifts that have elevated in popularity as a result of the pandemic. They include food subscriptions, which had fallen in popularity over the past two years but have gained traction this year, becoming the No. 1 planned subscription service gift followed closely by streaming service subscriptions.

“If there is pent-up demand for anything this holiday season, it is normalcy,” Cohen adds. “This season’s gift giving will be reflective of the time in which we are living, and the needs that go along with that, but the opportunities for growth lie in the innovative options that help consumers create the holiday cheer they are craving.”

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