Days of future present
With the rising adoption of minimalist principles, growing "bucket lists", a renewed focus on sustainability and the shunning of alcohol by Gen Z, consumers are looking for new ways to treat themselves and their loved ones.
While experiential gifting doesn’t yet account for a significant share of the gifting market, it is growing rapidly with a third of millennials purchasing experiential gifts in 2018 compared to 19% of the general population, and average expenditure amongst buyers rising 115% YoY to £129.
56% of UK adults surveyed in 2018 preferred the idea of receiving experiences over material gifts, as they feel they have everything they need. So, what are consumers currently buying?
In 2018, the top five categories were:
Theatre / comedy tickets – a traditional form of experiential gifting widely offered on websites including Buyagift and Theatre Tokens. This is a popular category enjoyed by a wide range of demographics.
Spa / beauty treatments – in an increasingly busy society, relaxing spas are a popular gifting choice and can be found from discount websites such as Groupon to luxury spa vouchers bought directly or from third party providers such as Red Letter Days.
Concert tickets – similar to theatre tickets, concert tickets offer sentimental value and can be shared both with loved ones and published on social media, making it a popular choice amongst the Millennials.
Meals out and cooking courses – the popularity of TV programmes like Bake Off and Masterchef have contributed to a 10% rise in restaurant gift cards in 2018 and a 25% YoY rise in Virgin Experience Days' cookery classes sales.
Red letter day vouchers – synonymous with the experiential gift market in the UK, Red Letter Day started trading in the late ‘80s. After a rough patch sending them into administration in the early 2000's, the company along with the wider market segment has recovered and offers experiences from cinema tickets to flying to the edge of outer space.
While the categories above are well known and established, consumers increasingly looking for "out of the ordinary" experiences, social causes and new skills is driving a wave of innovation in the experiential gifting industry. In late 2017, Airbnb launched ‘Experiences’ making it easier than ever for individuals and small businesses to start offering unique experiences in their local area.
It’s still early days for the industry and there is a lot of headroom for growth. From Red Balloon in Australia, Indiasanta in India and worldwide provider Tinggly, the trend towards experiential gifting is picking up across the globe. Even traditional retailers are adapting their offerings to jump on board. Just this week, Bath and Beyond in the US launched a new Wedding Registry category – "Gift Experiences" where registrants can choose from more than 300 memorable experiences, in addition to the traditional range of products for a wedding registry.
Brands and retailers can adopt to this growing trend by understanding their target audiences, including demographics, region, needs and motivations throughout the year.