Small Business Gift Spending to Remain Unchanged
As consumers keep a tight rein on their personal gift giving budgets this year, there’s another sector where spending will be flat to lower – gift giving by businesses. The American Express OPEN Small Business Holiday Monitor survey indicates that about half of small businesses will hand out customer holiday-related gifts. The average business will spend about $455 on these gifts, just $2 less than last year.
Mindful of the ongoing economic crisis, businesses are trying to find ways to keep their cash outlay to a minimum. Some owners are handing out fewer gifts. Others are turning to less expensive gifts. In addition, more business chiefs are trying to convert other assets such as reward points or their products/services into gifts.
Many CEOs of small businesses (69%) believe the U.S. economy will be suffering for years to come. Yet, they still believe it is important to give gifts, even at a reduced level. What motivates the average small business owner to give holiday gifts? The survey results indicate the following:
- To say thank you (82%)
- To celebrate the season (38%)
- To stand out from the competition (25%)
Demand for the following types of gifts are expected to be steady this holiday season:
- Gift cards to restaurants/retail stores
- Fruit/food baskets
- Donation to a favorite charity
Marketers who are looking to maintain or grow sales this year should promote themselves to small business owners. Using a promotional message that emphasizes the importance of the spirit of the season or appreciation for customer business should help to increase sales.[Source: American Express OPEN Small Business Holiday Monitor, November 9.2009]