26 June 2008
Going Green(HKTDC Gifts, Premium & Stationery, Vol 03,2008)
Market Trends Seminar
Several key factors are reshaping the global gifts industry, according to experts at aN HKTDC Gifts & Premium Fair Market Trends seminar
Environmentally friendly products, ethical trading, long-term shifts in consumer expectations and taking advantage of cultural and lifestyle habits are key to success in the gifts sector, insisted seminar speakers at the HKTDC Hong Kong Gifts & Premium Fair 2008.
The "green" trend, ethical trading and consumer expectation shifts are interlinked characteristics of mature markets such as the US and the UK. "Ethical trading is no longer considered a trend in the UK but a long-term shift in consumer expectations," explained Gift Focus Magazine Editor Sarah Reeve.
UK consumers are now seeking products with eco-friendly, organic, natural, recycled or fair-trade credentials. "The conscious consumer is a force to be reckoned with, and retailers ignore ethical trading at their own peril."
Cindy Baxter, Contributing Editor of US publication Gifts and Decorative Accessories Magazine agreed. "The green trend is growing in leaps and bounds in the US and has become a personal and lifestyle statement," she maintained.
Consumers in these markets are aware that their buying decisions have an impact on the environment and the quality of other people's lives, and therefore they seek out ethical and/or fair trade products.
Mature markets such as the UK and the US also have respected eco-accreditation systems that are now almost mandatory because consumers are actively seeking certified products.
The "eco-chic" market also extends to the packaging and manufacturing processes. "The more discerning customer wants to know the provenance of the product," Ms Reeve noted.
UK success stories include fair-trade gifts such as jewellery, where the proceeds are largely sent back to the community from which they were sourced, or those made from recycled materials. "Consumers are hungry for ethical products," Ms Reeve reiterated.
Another big hit is organic and toxin-free baby products and toys. "The UK market for organic cotton products is forecast to be worth £107m by the end of the year," Ms Reeve noted.
Organic skincare and beauty products and aromatherapy products are also big sellers in the UK and the US. "The green movement has raised the benchmark for these products and consumers want green products that are quality, in line with lifestyle trends and feature a funky design," Ms Reeve explained. "Success in the UK gift industry ultimately means being able to tick three boxes - green, quality and point of differentiation."
Ms Baxter concurred, adding that even small companies producing green products will have an open door to the US market as long as there is transparency with regard to issues such as testing and materials. "It is an ideal time to build customer loyalty because a company dedicated to green products will result in customers that are dedicated to the company," she said.
The green trend is also increasing in Japan, according to trade journalist Ryoko Mikami. "There is growing attention in the Japanese market place to eco-products," she revealed.
One example is decorative fabric gift wrapping that can be reused or re-purposed, while pens made from corn, solar wristwatches, portable chopsticks and recycled pottery products are also in demand. "Gifts that use licensed characters such as Hello Kitty, Snoopy and Miffy will continue to be big in 2008, but expect to see these products being made from organic materials," Ms Mikami advised.
Ms Baxter also identified the economy and "the greying of the US" as key trends. "The US economic problems will play out for some time and will affect those that deal in non-essential products," she predicted.
Gifts that will still do well are tabletop, mid-range electronics and home entertaining items. "Travel toys will be big because families are taking road trip holidays instead of flying," Ms Baxter added.
The baby-boomer generation also provides opportunities because this section of the market has the largest discretionary income. "They recognise and expect quality and will spend money on gifts for their grandchildren," Ms Baxter explained. "Other hot greying-market areas are travel products, wine accessories, exercise equipment, and hobby and special-interest items."
Key Market Trends
Distinct differences are clearly apparent in several international gifts and premiums markets: