Experiences — the gifts that keep on giving
When John Stange turned 50 this May, his wife, Kimber, plumbed her brain to come up with a special gift.
A sweater? Nah, she thought. That’s a snooze. Shoes? Too boring. A shiny watch? Not good enough.
A few months later, Kimber watched her husband zip into a flight suit and strap into a light attack fighter trainer plane (with a pilot along for safety). In the skies over the Pacific Ocean near San Pedro, Stange dodged and wove, mock fighting another plane flown by a fellow adrenaline-seeking customer. Every time Stange landed a “kill shot,” the other aircraft billowed smoke.
Price tag on the “Top Gun” experience offered by adventure company Air Combat USA in Fullerton? About $1,300.
“Probably one of the top five coolest things I have ever done in my life,” said Stange, of Murrieta, who develops and maintains a National Marine Mammal Foundation diving program. “And one of the best gifts ever.”
With Christmas Day looming, shoppers are running to malls to pick up sweaters for the siblings, slippers for Dad and a pair of earrings for Mom. But some are opting for a different kind of present altogether: experiential gifts.
Shoppers who don’t want to give Grandpa a tie or Grandma a book are increasingly turning to experiences — from relatively inexpensive ones such as massages, dinners out and ice-skating lessons to pricier ones, such as flights in jet fighters and vacations abroad.
Partly, it’s a sense that people already have all the stuff they need — especially baby boomers who are trying to clear the clutter out of their homes and garages.
“These experience-type gifts have really taken off,” said Marshal Cohen, chief industry analyst at NPD Group. “Two years ago they weren’t on anyone’s radar, and now they are very popular.”
In addition, deal sites such as Groupon, LivingSocial and Gilt City are making it easier to buy such gifts by sending out emails strewn with offers, everything from butcher lessons to murder mystery dinners. A handful of companies, including Excitations and Cloud 9 Living, have specialized in collecting and organizing experience packages for sale online.
“People are putting more value on having new life experiences as opposed to accumulating stuff,” said Elizabeth Bell, director of business development for Excitations, based in Sterling, Va. “Gadgets become obsolete very quickly, whereas memories last a lifetime.”
Chicago-based Groupon runs an Internet holiday shop called Grouponicus, where the “vast majority” of gifts are experience-based, said Aaron Cooper, the company’s chief of gifting. Cooper called localized experiences “our core bread and butter” business.
“Companies like Groupon or LivingSocial or these other daily-deals sites have made it easier for consumers to make these types of purchases, or put experiences on top of people’s minds as gifts,” said Herman Leung, an analyst at Susquehanna International Group.
Jeffrey Houston, a technology analyst at Barrington Research Associates, estimates that Groupon makes about 23% of its revenue in North America from activities-related buys, just behind food and drink purchases.
Experiential gifts will also get more popular as more people use them as “a discovery tool,” Houston said. “People like figuring out fun things to do in the place you live and places you visit,” especially when the idea is delivered straight to your inbox daily.
Jordan Stewart of Brentwood is a veteran giver of experiences, recently having bought a bus tour of Los Angeles for her boyfriend and a massage certificate as an early Christmas present for her best friend.
She said such presents are especially useful for procrastinators, workaholics and anyone with little time for shopping. “I travel a lot for work, and also travel home for the holidays. So having to bring presents home in suitcases can be a hassle,” said the 25-year-old management consultant. “But all you have to do with these presents is print it out or email it.”
The yearning for experiences is likely to provide a huge boom in this gift category, driven by baby boomers who are retiring and looking to reconnect with family and friends after a lifetime of work, said Kevin Kelly, chief executive of Civano Living, an advisory company that recently conducted a survey on the purchasing patterns of baby boomers.
“They are shifting away from bling and conspicuous consumption and going toward more meaningful experiences,” Kelly said. “They want experiences that will gather friends together and rebuild relationships.”
Companies that deal in experiences work in similar ways, partnering with local companies and taking a slice — anywhere from 20% to 50% — of the total purchase value. Some offer deep discounts on services, like Groupon, while others simply provide a portal organizing local merchants by city and category.
Cloud 9 Living, based in Boulder, Colo., has seen annual revenue rise from $1.5 million in 2007 to $3.2 million last year. It partners with more than 600 small companies around the country.
Executive Vice President Bobby Augst said the explosive popularity of social media has given the company a big boost. “People like sharing videos and photos of themselves doing exciting new things, so they have to go out and get behind the wheels of a race car, or go hot air ballooning, to get those photos to post on Facebook,” Augst said.
To be sure, there are still many shoppers like Kim Mayes, who loves seeing a stack of brightly wrapped gifts under the tree.
“How much thought have you really put into a gift that you can just click and print?” said the 45-year-old investment consultant. “It’s like giving a gift card.”
But for people who prefer a thrill, there’s a vast array of experiences to pick from — some romantic, others dangerous and some unusual.
Carolyn Grantham’s husband, Diego, took her to commune with wolves near Boston last September for her birthday.
After signing waivers releasing the habitat operator from liability, the couple stepped into an enclosure with two gray and white wolves and fed them dog treats and frolicked with them.
“One came up and greeted me and put her paws on my shoulder and nipped my chin,” said Grantham, 42, a Web editor. “I’ll never forget it, and I’ll always be able to brag about it.”
