Shoppers Dream Big with Inspirational Gift Lists
Reposted from Reuters | By Mitch Lipka
A $5,000 Bose home theater system, a $2,700 Tempur-Cloud mattress, a $450 Dyson pedestal fan (like the one used at the Kardashian house) and an $85 box of frozen mini hot dog appetizers are just a few of Oprah's Favorite Things.
The host's annual TV special on her OWN Network airs this week, and features 60 of her favorite extravagances. With it, consumers will be exposed to one of the biggest joys of the season for shoppers and retailers alike: the aspirational gift list. (here)
The holiday shopping season provides a convenient opportunity for retailers and brands to plant ideas in consumers' heads through gift lists, advertising and public relations buzz.
More than a little of that translates into sales. Luxury goods revenues for the last quarter of 2012 are expected to rise 7 percent in 2012, according to Bain & Company, a consultancy that serves the global luxury market. U.S. sales make up the bulk of that market, with China and Japan filling out the top three.
"This is a great time for retailers and brands to make a connect with their shoppers. It plants the seed in your head. 'I might not make that purchase now, but I know it's out there," says Michael Shmarak, vice president at DKC Public Relations, Marketing & Government Affairs in Chicago.
Oprah is not alone in creating gift lists that can push consumers to think big. Indeed, no list appears to be quite as aspirational as the one produced by Dallas-based luxury retailer Neiman Marcus. (here)
His and her gold and diamond Van Cleef & Arpels watches that come with a trip to Paris and Geneva top the retailer's list for $1.1 million. Too pricey? How about $250,000 for a dinner for 10 at your home prepared by four famous chefs? Or $30,000 to get a walk-on role in "Annie: The Musical"?
Even if you're not going to go that over-the-top and will take a pass on the Neiman Marcus special edition McLaren 12C Spider convertible ($354,000), there are plenty other luxury items that are being promoted to consumers.
"We have definitely noticed that price creep is happening with gadgets, toys, and luxury goods," says Dana Holmes, editor in chief of Gifts.com. "And, it seems like shoppers are up for the extra spend."
But that might come at the expense of other purchases, she says. "We believe that shoppers are buying one pricey gift as opposed to many inexpensive gifts when it comes to close family and even children. But, we are also seeing a big push by retailers to have a variety of gifts under $50, and even under $25, so that shoppers can get a little something extra without feeling guilty after making those big purchases."
While a $275 bottle of Casa Dragones Sipping Tequila that Oprah picked might not make the cut on a lot of shopping lists, perhaps the $52 Milagro Select Barrel Reserve Silver Tequila she also chose will.
And Oprah's list does include a scattering of less expensive items – from bath towels to candles to coconut and peanut spread. Many consumers might balk at the idea of paying $238 for a collection of Lafco soaps Oprah selected, but perhaps some will buy one bar of the soaps for $17, says Shmarak.
Or they'll aim for one of the higher priced items down the road. Or buy something else from one of the high-end brands, but at a lower price. "They might not have the top end, but they might go for that middle or bridge end to get something that has that name on it," Shmarak says.
Some also see the idea that Oprah's list has some higher-priced items this year than last year as indicative of a positive turn in the economy. Last year's highest priced item – a woven tote bag – cost $595. This year, it's the Bose VideoWave II home theater system for $4,999.
Oprah's list also has a significant percentage of items under $50.
"The country isn't in a growth mode yet, but consumer confidence has been steadily increasing," says Sheri Bridges professor of marketing at Wake Forest University Schools of Business. "People are ready to come out of economic hibernation and into the light of optimism that characterizes Americans…Who wants to see socks and drills on a list when electric bicycles and metallic high-top sneakers are much more fun and interesting?"
Shmarak agrees, and sees Oprah's list as also giving a window into things that just make you feel good.
"Looking at all of the foodstuffs and things for the home on the list, it certainly fits (with) lifting people out of the doldrums and making people feel good about themselves when they consume a product," Shmarak says. "Many of these things are indulgences."