NEW YORK and LONDON; Dec. 18, 2002 – As consumers embark on the final rush to purchase holiday gifts, no single blockbuster gift item has emerged to capture their imagination or disposable income, according to an Accenture survey of more than 2,000 people in the United States and United Kingdom.
In fact, the majority of respondents say it looks like a "fad-less" Christmas. According to the survey, conducted online by Survey.com from November 26 to December 3, 2002, more than 60 percent said there was no fad this year or were not able to name one. Memorable past fads in the U.S., in order of sales popularity, include Tickle Me Elmo (1996); Cabbage Patch Kids (1986); Sony Playstation (1995); and Furby (1998). The top U.K. fads are Furby (1998); Sony Playstation (1995); Buzz Lightyear (1995); and Teletubbies (1997).
Fads are serious business for retailers. With many retailing companies already struggling because of the soft economy, the lack of a big seller this holiday season further clouds their financial outlook. Most stores generate a significant percentage of their annual sales during the fourth quarter of the year, and much of that comes during the crucial pre-Christmas period. Exacerbating the situation this year, particularly in the U.S., is that with Thanksgiving occurring so late on the calendar, the traditional peak shopping period is shorter than usual.
Equally troubling for retailers and manufacturers are the reasons survey respondents gave for the lack of fads: "there is nothing exciting" (45 percent); "there is nothing innovative" (36 percent); and "there is nothing new" (31 percent).
What really makes a fad? According to those surveyed, the impact of media attention and heavy product promotion are more significant factors in propelling a product to fad status than breakthrough product innovations or the ability of manufacturers to correctly anticipate what the public wants.
"In a tough economic environment and with the threat of war looming, media attention naturally has been weighted more toward hard news and manufacturers have reduced their promotional budgets," said Tom Davenport, an Accenture partner who is director of the Accenture Institute for Strategic Change, a "think and act tank" dedicated to making Accenture the world leader in innovative, breakthrough management thinking. "With the resulting lack of marketing and media ’hype’ supporting product sales, companies must do a better job of understanding their customers’ core needs and providing products and services they value."
Other recent research from Accenture confirms the results of the holiday survey. In an October 2002 report, "Consumer Attitudes Toward Innovation," Accenture detailed the results of a survey of more than 3,500 consumers in the United States and key European markets. According to those findings, the products and services that grabbed consumer interest offered features meaningful to them, such as improving their physical health and well-being or providing intellectual stimulation.
U.S. vs U.K
The Accenture survey released today shows that U.S. consumers are feeling the economic pinch much more than their U.K. counterparts, leading them to be more circumspect in their holiday shopping this year.
Budget constraints increasingly are driving purchase decisions, particularly in the U.S. Fifty-eight percent of American consumers cited budget constraints as a factor this season, compared with 32 percent of British respondents. Despite this disparity, an equal number of respondents on each continent indicated that they would split their purchases evenly between "necessity" items and those that are "fun."
Forty-one percent of U.S. respondents said they will spend less on gift buying this holiday season, more than double the 19 percent of U.K. respondents.
Nineteen percent of U.K. respondents said they plan to spend more overall this season, almost double the 10 percent in the U.S.
The survey also found the following trends in consumer behavior and attitudes:
The majority of respondents intend to spend the same amount this year as last on holiday purchases:
55 percent will spend the same 30 percent will spend less 14 percent will spend more
Whether spending less, more or the same, the majority of people intend to give the same number of gifts.
The events of September 11, 2001 will play no major factor in the types of gifts purchased:
70 percent say 9/11 will have no impact on the decision to buy patriotic gifts 6 percent are more likely to buy patriotic gifts 4 percent are less likely to buy patriotic gifts
More than half of respondents (55 percent) say the events of September 11, 2001 and the possibility of war are not expected to affect holiday spending
The majority of those polled both shop and buy online:
25 percent browse online 70 percent browse and purchase online
The top reasons cited for shopping online include:
Comparing products or prices (75 percent) For convenience (70 percent) To browse for ideas (63 percent) To find products not found in stores (55 percent) To save money (53 percent) To save time (53 percent)
Accenture is the world’s leading management consulting and technology services company. Committed to delivering innovation, Accenture collaborates with its clients to help them realize their visions and create tangible value. With deep industry expertise, broad global resources and proven experience in consulting and outsourcing, Accenture can mobilize the right people, skills, alliances and technologies. With more than 75,000 people in 47 countries, the company generated net revenues of $11.6 billion for the fiscal year ended August 31, 2002. Its home page is www.accenture.com.