Survey highlights gift indies plans to further expand on card front
Greeting cards were a sales salvation for many gift shops in the last year, with many indies planning on ramping up their greeting card selection further in 2023 – these are just some of the top-line insights from the recently-published PG&H Retail Barometer.
Compiled by PG’s sister magazine Progressive Gifts & Home, the survey looks back at 2022 and forward to what’s to come this year following the celebration of Easter this week and the King’s Coronation in May.
Following a year of challenges – rising inflation, increased mortgage repayments, excessive energy and fuel costs, the outbreak of war in Ukraine, rail and postal strikes, and three different prime ministers – gift retailers took the time to explain how they have fared, with the majority reporting a decent outcome despite the hurdles.
And, while home-fragrancing products was the strongest growing product sector according to 67% of respondents, showing the biggest increase in 2022 over the year previous, it was followed by toys and games (60%) and greeting cards (57%). However, this has to be seen in the context that greeting cards came out tops of last year’s Barometer.
Looking to this year, greeting cards shared second place with home fragrancing, clothing, and men’s gifts as the product area gift indies see as ripe for further diversification.
Other gift categories expected to see growth this year include gift books, food gifts, games and puzzles, jewellery, home accessories and gift-led stationery, followed by partyware and balloons, and giftwrapping.
On the eco front, almost three quarters of gift shops taking part in the survey (73%), confirmed they had made changes relating to sustainability, with 62% of those saying they had changed or found new suppliers based on their environmental credentials, as well as undertaking more vigilant recycling in the business, and also equal in second place were cutting down on plastic bags, and reducing stocking gifts and cards with glitter.
For many gift retailers, supporting local suppliers is very important as locally designed and manufactured products ring up sales – and a whopping 93% of respondents confirmed Made In Britain was important or very important to them when placing orders in 2022.
On the whole, 2022 was a surprisingly good one for gift indies, if a bit of a rollercoaster due to external factors as the ongoing impact of Covid19 coupled with the cost-of-living crisis had the biggest detrimental effect.
However, two thirds of respondents reported that business in 2022 was better or the same as in 2021 although, as many respondents pointed out, that had been an unprecedented 12 months, as shops were in lockdown for a significant part of the year, making it difficult to compare like-for-like.
The average spend increased for 70% of respondents, who reported it had increased slightly or significantly, or had remained the same and, despite the naysayers, Christmas turned out to be a strong one for many, with 70% of respondents – compared to 90% the year previous – confirming that Christmas 2022 was better or the same as Christmas 2021.
Having experienced an unsettling festive period, with the cost-of-living crisis raging, disruptive rail and postal strikes causing havoc, and the media across the board putting out continuous, negative stories, the expectation was that consumers would tighten their purse strings when it came to Christmas gifting, with a lower spend expected as gift givers edited their present buying list or abandoned gift buying altogether.
Interestingly, the findings of the PG&H Retail Barometer knocked those predictions on the head, with 81% of respondents revealing shoppers were determined to dig deep for the festive season. Less than a fifth said that shoppers spent less than the previous Christmas.
The biggest positive was online/website activity for 42% of those surveyed, with product diversification and staff tying for second place, and shop local campaigns were third, followed by increased social media activity, then increased promotional activity, winning an award, and generating local media coverage, all tied in fifth place.
According to respondents, a massive 88% of gift independents now have a website, with 57% of those having a transactional site, and the rest opting for one providing information only. Almost two thirds (63%) of respondents plan to develop their website further over the coming year, with a similar percentage intending to get a website up and running in 2023. For those with both bricks and mortar stores and an online business, 57% confirmed that the website drove footfall into their shop.
As garden centres continue to expand, becoming mini department stores as many describe them nowadays, they have evolved to become the biggest single retail threat for gift independents, with a huge 88% citing them as their biggest threat or serious threat in 2022, while over 80% see supermarkets, which were allowed to sell everything during lockdown, as a continuing threat or serious threat.
And their biggest concerns are general price increases (59%), consumers reducing their spend (47%) and business rate increases (41%).
As for 2023, the mood seems encouragingly positive, with most gift retailers predicting business will remain about the same or they expect to see marginal growth this year.
Showing their support for King Charles III, almost half of respondents said they are planning to celebrate the historic occasion, looking forward to hanging out the bunting and decorating their shops with flags. As well as show-stopping window displays, there will also be celebratory food and drink in store, along with related, keepsake Coronation giftware.
For three quarters of respondents, staffing levels will remain the same in 2023, with a further 12% looking to recruit new members of the team, and the same percentage looking to reduce the number of people on the payroll. As for opening new stores, only 6% said they would be doing so.
However, despite a rollercoaster few years, 53% of respondents feel positive or very positive about the future of gift retailing – with a little bit of help from the greetings industry!
The full PG&H Retail Barometer story appears in the March/April issue of Progressive Gifts & Home and can be read here.
