Connecting With the Future

In a recent Wall Street Journal article, Enesco Group Inc. president Dan DalleMolle made a curious statement about the future direction of his company. "We need to change Enesco from a collectibles company to a giftware company," he said. He also outlined the strategy that he says will get the company's flagship line, Precious Moments, back on track: selling "little trinkets that go on top of ribbons and gifts" at Wal-Mart.

How can a new business in "trinkets" (undifferentiated, generic novelty items) get the sales of Precious Moments (a highly differentiated, branded line) jump-started? What Dan and everyone else in the giftware business needs to do is to turn 180 degrees and look at our own business, our products, and our retail selling environments from the point of view of the shopper.

What we discover may threaten the fundamentals that have governed the operation of our businesses for the last 20 years. But only through such serious soul-searching can we hope to get our businesses back on track.

For years, my company, Unity Marketing, has published the giftware industry's definitive research study. Looking at the gift industry in the same way that the industry sees itself, we divided giftware into five major categories: Home Decorative Accents, Collectibles, Seasonal Decorations, Greeting Cards and Stationery, and General Gifts and Novelties. Using the industry as our guide, we accepted the "conventional wisdom" that business was all about product, and that the solution to a company's flagging sales was new product.

It wasn't until I started research for my book, Why People Buy Things They Don't Need, that I discovered the error in the industry's "product is king" gospel. Gifts are the quintessential item people buy that they don't need. When shoppers buy anything out of desire, not need, they are driven by emotions. Therefore, the thing they buy becomes a means to an end, and that end is a feeling. In effect, they aren't buying the thing at all, they're buying a feeling. No wonder giftware manufacturers are struggling — they think it's all about product. And no wonder gift stores are challenged — they think they're in the business of selling product.

Further complicating an already complicated selling environment is the fact that the dominant industry trend of cocooning, which so positively influenced the giftware business for the past 20 years, is over. The new macro consumer trend is connecting, which is manifesting itself in an anti-materialistic ethos and a passion to simplify one's life. The magazine Real Simple expresses perfectly the new downsizing, anti-cocooning mindset, as do reality TV shows devoted to household organization, such as HGTV's Mission: Organization and The Learning Channel's Clean Sweep.

As consumers seek remedies to household clutter, it's getting harder for them to justify the purchase of purely decorative objects, such as figurines and other collectibles — which have been re-christened "dustibles" by consumers in recent focus groups. Rather, customers are looking for decoration paired with functionality. As a result, demand for clutter-reducing decorative objects — such as baskets, boxes, vases, and pots — is on the rise.

The key challenge for both manufacturers and retailers is to reach out and meet consumers where they live. We have to create products consumers really want, and offer those products in shopping environments that appeal to their passions and desires.

To do that, we must embrace the new connecting trend. Connecting with the consumer is all about enhancing the emotional experience of shopping and buying. In other words, it isn't the gift that's important; it's the gifting. The gift itself is simply a means to an end, and that end is a satisfying emotional connection between individuals.

Today's consumers value convenience most of all in their shopping experience. They don't want to trudge from store to store to find that special, emotionally evocative gift. Rather, they tend to shop for gifts in the same places where they shop for themselves.

One way to make the shopping experience as convenient as possible is to compile a list of the top gift suggestions for specific relations (such as husband, wife, child, or coworker) and price point ranges ($25 and under, $26–$50, and $51–$100). Post the list prominently near the cash register or in the window.

Shoppers also want knowledgeable, well-trained salespeople to guide them. They demand that the checkout process be as convenient as possible. Since so many retailers are depersonalizing the shopping experience, specialty retailers that put the personal back into it will be greatly rewarded.

Don't forget that presentation counts too. To maximize sales, provide quality giftwrapping services. Giftwrapping can even be-come a valuable profit source when you offer upscale, luxurious paper selections along with the service. And make sure the store's name is included on your packaging, either on the box, gift card, or receipt — or all three.

Before another gift manufacturer decides to introduce a new line of decorative trinkets, and a retailer expects that selling those trinkets is going to keep the register ringing, they'd better take a cold, hard look at today's consumer. Times have changed. It's the gifting that counts.