Today's Gift Retailer
Key categories are proven sales performers even in difficult times.
By Judi Fulbright -- Gifts and Dec, 6/1/2009 12:00:00 AM
In the land of comic book characters, the Fantastic Four are just that — pretty fantastic; they perform wonders even in difficult times. Well, the same can be said for the four products at the top of gifts and decorative accessories stores' sales for 2008. Judging them on consistency alone, jewelry and holiday products have hovered around 10 percent of sales for the past five years. Candles and accessories, along with greeting cards, have done the same thing at around the five percent mark. Taken as a whole, the four grab one-third of stores' annual sales; a nifty shared superpower.
Other superpowers that they have are nothing to sneeze at either; all four are carried by more retailers than any other product in a typical store's merchandise mix. Jewelry and holiday items bring in some of the highest prices, too. The gift Fantastical Four averages a higher median number of lines carried, four, higher than the average of two for all remaining products.
Another group of products, while not as fantastical as the top four, combine to generate another one-third of store sales. They're the Go-To 10; products retailers can count on to produce sales. Wall art, ceramics/pottery and tabletop are carried by at least one-half of the retailers surveyed. Wall art claims the highest ticket, with tabletop, ceramics/pottery and handcrafted pieces among those with some of the highest price tags as well. These 10 average a median of four lines carried. "The risks of new, unproven products are higher now," said a gift specialty retailer, describing the challenges he's currently facing. It is hard to pick the right mix of products, maybe even requiring some help from the super-powered. When times are tough retailers can look to the Fantastical Four and the Go-To 10 to take the lead.
Nearly one-half of the retailers responding to this year's survey estimated 2008 sales were about the same or better than they were in 2007. Projecting ahead for 2009, almost two-thirds hope year-end sales will be about the same or better than they were for 2008. A gift specialty retailer plans to meet 2009 head-on by "keeping the store full — having new merchandise while having no idea how to predict or forecast the sales figures.
Sales Performance in Gift Stores
Percentage of retailers saying sales were ...
| 2008 compared with 2007 | Projected 2009 compared with 2008 | |
|
Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009
|
||
| Up | 22% | 17% |
| About the same | 26% | 45% |
| Down | 52% | 38% |
Core Sales Leaders
The Fantastical Four
Generating one-third of sales
| Percentage of 2008 total annual sales | Percentage of retailers carrying | Median number of lines carried | Median price points | |||
| Best- | ||||||
| Lowest | Selling | Highest | ||||
| • Blue bolding indicates product carried by one-half or more of retailers. Green bolding indicates product carried by one-third to one-half of retailers. • Median price points have been rounded to the nearest whole dollar. |
||||||
| Greeting cards | 9% | 77% | 3 | $2 | $3 | $5 |
| Holiday products | 9% | 74% | 6 | $3 | $19 | $95 |
| Jewelry | 8% | 68% | 5 | $10 | $35 | $128 |
| Candles/accessories | 6% | 83% | 3 | $3 | $15 | $25 |
| The Go-To 10 | ||||||
| Generating another one-third of sales | ||||||
| Percentage of 2008 total annual sales | Percentage of retailers carrying | Median number of lines carried | Median price points | |||
| Best- | ||||||
| Lowest | Selling | Highest | ||||
| Gourmet foods | 4% | 40% | 4 | $3 | $6 | $11 |
| Handcrafted products | 4% | 39% | 3 | $8 | $41 | $80 |
| Home textiles | 4% | 38% | 4 | $9 | $22 | $61 |
| Baby/infant products | 3% | 48% | 4 | $4 | $20 | $50 |
| Ceramics/pottery | 3% | 55% | 4 | $10 | $22 | $80 |
| Fashion accents | 3% | 39% | 5 | $6 | $35 | $76 |
| Social/business stationery | 3% | 33% | 3 | $4 | $12 | $20 |
| Tabletop products | 3% | 52% | 4 | $10 | $40 | $98 |
| Toys/games/puzzles | 3% | 39% | 3 | $3 | $12 | $30 |
| Wall art | 3% | 59% | 3 | $17 | $45 | $251 |
High-End Price Erosion
For more than one-half of the products measured at the highest price point level, prices have either dropped or stayed the same between 2008 and 2007, showing an average drop of 27%. Seven of the products with dropping price points were also core sales leaders, numbering among the Fantastical Four and the Go-To 10.
| Median highest price points | Percentage change | ||
| 2008 | 2007 | ||
| • Green bolding indicates product among the Fantastical Four. Blue bolding indicates product among the Go-To 10 sales leaders. • Median price points have been rounded to the nearest whole dollar. Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009 |
|||
| Accent rugs | $39 | $118 | -67% |
| Handcrafted products | $80 | $150 | -47% |
| Social/business stationery | $20 | $33 | -38% |
| Wall art | $251 | $380 | -34% |
| Housewares | $50 | $75 | -33% |
| Pet products | $25 | $37 | -32% |
| Desks/home office | $35 | $50 | -30% |
| Gourmet foods | $11 | $15 | -27% |
| Photo frames | $30 | $40 | -25% |
| Writing instruments | $23 | $30 | -23% |
| Ceramics/pottery | $80 | $100 | -20% |
| Candles/accessories | $25 | $29 | -13% |
| Gift baskets | $88 | $100 | -13% |
| Holiday products | $95 | $100 | -5% |
| Permanent florals | $64 | $65 | -2% |
Other Products in the Mix
Other Stalwart Gift and decorative accessories products each generate two percent or less of sales while they are carried by 10 percent or more of the retailers surveyed.
| Percentage of retailers carrying | Median number of lines carried | Median price points | |||
| Best- | |||||
| Lowest | Selling | Highest | |||
| • Median price points have been rounded to the nearest whole dollar. Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009 |
|||||
| Photo frames | 64% | 3 | $8 | $20 | $30 |
| Personal care/aromatherapy | 55% | 3 | $5 | $15 | $30 |
| Collectibles | 47% | 3 | $10 | $41 | $120 |
| Gift books | 47% | 2 | $6 | $15 | $30 |
| Glassware/crystal | 47% | 3 | $10 | $26 | $69 |
| Plush products | 44% | 3 | $5 | $15 | $40 |
| CDs/music | 38% | 2 | $15 | $16 | $18 |
| Permanent florals | 37% | 3 | $10 | $20 | $64 |
| Giftwrap | 31% | 2 | $3 | $4 | $7 |
| Housewares | 28% | 4 | $4 | $15 | $50 |
| Desk/home office accessories | 27% | 2 | $7 | $18 | $35 |
| Licensed products | 25% | 3 | $8 | $26 | $76 |
| Party products | 23% | 3 | $1 | $7 | $10 |
| Writing instruments | 23% | 2 | $7 | $12 | $23 |
| Accent rugs | 22% | 1 | $20 | $29 | $39 |
| Gift baskets | 21% | 1 | $5 | $40 | $88 |
| Pet products | 16% | 3 | $3 | $6 | $25 |
| Gourmet tools/cookware | 13% | 2 | $2 | $4 | $50 |
Operations in Gift Stores
Space Allocation
| • Other includes: Event space, PODS on-site and work room. • Median square footage at all locations: 2,250 |
|
| Selling space | 74% |
| On-site stockroom/storage | 13% |
| Off-site warehouse/stock storage maintained by your company | 6% |
| Administrative/office/utilities | 5% |
| Other | 2% |
Hours of Operation
• Median number of hours open per week: 48
Sales Timing
Percentage of sales done each day
| Sunday | 6% |
| Monday | 12% |
| Tuesday | 13% |
| Wednesday | 12% |
| Thursday | 15% |
| Friday | 19% |
| Saturday | 23% |
Close Ratio: A Bright Spot
Number of purchasers in an average week divided by the number of customers
2008: 70%
2007: 60%
Sourcing
Finding New Products or Vendors
| Important | Not important | |
| Vendors' print catalogs | 100% | &1% |
| Vendors' websites | 96% | 4% |
| Trade print publications | 95% | 5% |
| Tradeshows' print newsletters | 88% | 11% |
| Tradeshows' websites | 83% | 17% |
| Trade pubs' eNewsletters | 83% | 17% |
| Trade publications' websites | 82% | 18% |
| Tradeshows' eNewsletters | 77% | 23% |
| Trade eNewsletters | 76% | 24% |
| Sales reps' websites | 67% | 33% |
Advertising/Marketing
• Median percentage of 2008 annual sales devoted to ads and promotions: 5%
Types of advertising
| Percentage using | Percentage of total ad budget | |
|
Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009
|
||
| Newspaper ads | 59% | 24% |
| Direct mail | 47% | 18% |
| Magazine ads | 26% | 10% |
| Special events | 43% | 10% |
| Yellow pages | 31% | 7% |
| Internet ads | 18% | 5% |
| TV ads | 13% | 4% |
| Radio ads | 16% | 3% |
| Electronic newsletter/email | 7% | &1% |
| Billboards | 4% | 1% |
| Local publications tour books brochures, etc. | 3% | |
How Green?
Percentage of retailers
| Currently doing | Plan to do | No plans | |
|
Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009
|
|||
| Offer recycled/eco-friendly products | 68% | 9% | 22% |
| Use energy-efficient lighting | 66% | 14% | 21% |
| Use a programmable thermostat | 62% | 8% | 30% |
| Recycle paper/plastic/aluminum | 77% | 3% | 20% |
| Reuse packaging materials | 90% | 3% | 7% |
| Sell reusable shopping totes | 46% | 16% | 38% |
| Change from plastic bags to paper | 53% | 8% | 39% |
| Use "green" cleaning products | 48% | 12% | 40% |
| Change to water-minimizing fixtures | 22% | 12% | 66% |
Other green strategies mentioned were:
-
Offer a discount if customers bring back bags to be re-used
-
Encourage customers to return their store bags
-
Changing from plastic/paper to fabric bags
-
Process for open/close that manages energy use
-
Lighting on remote controls, window tinting
-
Promote the benefits of buying local in order to minimize our carbon footprint
-
Email invoices and purchase orders
On The Web?
| Have a website | 54% |
| Do not have a website | 46% |
Web Site Features
Percentage of retailers having a web site
| Product images/information | 89% |
| Store contacts with e-mails | 74% |
| Online ordering for consumers | 53% |
| Announcements/invitations to store | 51% |
| Discounts or coupons | 32% |
| Order tracking (online or in-store) | 26% |
| Links to manufacturers' websites | 23% |
| Discussion boards or blogs | 19% |
| In-stock status of products | 18% |
| Click-to-call or live chat | 5% |
Online Sales
53% of those with a web site offer online ordering
4% median percentage of total annual sales generated from online ordering
Online Sales Performance
Percentage of retailers reporting online sales were ...
| 2008 compared with 2007 | Projected 2009 compared with 2008 | |
|
Source: Gifts & Decorative Accessories, Today's Gift Retailer, 2009
|
||
| Up | 52% | 57% |
| About the same | 30% | 30% |
| Down | 18% | 13% |
Why No Web Site?
| Lack of knowledge/expertise | 45% |
| Lack of staff | 37% |
| Cost of setting it up | 35% |
| Cost of maintaining it | 31% |
Plans for Future Web Site
| No plans | 49% |
| 1st or 2nd quarter, 2009 | 14% |
| 3rd or 4th quarter, 2009 | 23% |
| 2010 | 14% |
How Gift Stores Use the Internet
| Often | Sometimes | Never | |
| Research new products | 66% | 30% | 3% |
| Find new sources | 63% | 31% | 6% |
| Check/read business news | 53% | 38% | 9% |
| Register for shows or markets | 49% | 33% | 18% |
| Check out product pricing | 46% | 37% | 17% |
| Place orders with vendors | 43% | 42% | 15% |
| Track orders with vendors | 33% | 44% | 23% |
| Preview products on trade pubs' websites | 32% | 32% | 36% |
| Track shipping with vendors | 30% | 47% | 23% |
| Check out competitors | 28% | 43% | 28% |
| Engage in blogs or discussion groups | 8% | 19% | 74% |
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