Consumer Journey: Children’s gifts (Canada)

Part
01
of two
Part
01

Children’s Gifts Insight: Spending and Marketing (Canada)

Etiquette experts agree that $20-30 is perfectly reasonable for a child’s birthday gift and a maximum of up to $100 for the child of a close friend or relative. In comparison, an average American is ready to spend about $330 per child on holiday gifts like Christmas gifts. Below is an overview of the findings

CHILDREN’S GIFTS INSIGHT: SPENDING AND MARKETING

The Typical Spend on Birthday And/Or Winter Holiday Gifts

  • According to a recent survey, "the average parent spends approximately $400 on a birthday party for their child."
  • According to etiquette experts, $20-30 is a reasonable amount to spend on a child’s birthday gift and a maximum of up to $100 can be spent on the child of a close friend or relative.
  • The average American is ready to spend about $330 per child on holiday gifts like Christmas gifts.
  • Grandparents spend an average of $218 on holiday gifts for their grand kids.
  • As per a survey by Opploans, grandfathers spend more on holiday gifts ($244) than grandmothers ($202).

The “Sweet Spot” for Pricing

  • According to Jennifer Porter and other experts, $25 gifts are considered as the "sweet spot" regardless of what the relationship with the child is.
  • Also, if an all-in cost birthday party costs $500 or more, it is known as a "budget-buster".

Who Should Marketing Materials Be Angled To


PARENTS

CHILDREN
  • A marketing study reports that "52% of three-year-olds and 73% of four-year-olds often, or almost always, asked their parents for specific brands."
  • The CFC reports that children who are younger than 12 influence $500 billion in purchases annually.
  • Brands like Target allow kids to take control and create their own content thereby creating brand ambassadors and consequently increasing its understanding of children's likes and dislikes.

How Does a Company Attract New Customers?

  • As more parents shop online, brands attract them by selling their products through Amazon, Etsy, and other online retailers that parents often use.
  • Also, advertising on social media sites like Facebook, Instagram, and Pinterest, or blogs/publications like Parenting, Focus on the Family, helps promote and market gift and shopping ideas for kids.
  • The "pester power" of a child has a massive influence on parents when they want something for themselves.

Marketing Change Depending on the Time of Year

  • Retailers plan their promotions and marketing based on the prior year, the back-to-school period, and holiday seasons to drive sales.
  • Parents are the main target for marketers during the holidays because they spend the cash and make gift-buying decisions.
  • Marketing can alter depending on "how close key shopping events are", for example, Black Friday and Cyber Monday, Christmas and Hanukkah, and other holidays.

Additional Insights

  • As per PwC Canada, Canadians spend over $1,500 on average during the holiday season and 41% of that amount is spent on gifts.

Research Strategy

To identify and compile insights for the gift-buying journey of Canadian parents shopping for their children, we scoured for information through industry reports and blogs from KPMG, Inc., PWC, Statistics Canada -the national statistical office, Markets and Markets, Euromonitor, Statista, Pew Research, among others. We also scoured through media publications and news articles from Retail Dive, Reveal Advertising, Global News, The Daily Mail, NY Times, WSJ, among others. The idea was to gain insight through the surveys/studies conducted by the above-mentioned sources which highlight the consumer journey for Canadian parents purchasing gifts for their children.

We were able to gain insights on the consumer journey for Canadian parents purchasing gifts for their children for the U.S. market and not for the Canadian market as all studies and surveys for the Canadian market focused on the average spend by person in Canada, household consumption, education, recreation, health, kids aged 18 and older and not on the gift-buying journey of Canadian parents shopping for children younger than 18 years. Hence, we have provided supplement research focused on the United States in the absence of Canada-focused insights. We dug deep and found the insights mentioned above.

Part
02
of two
Part
02

Children’s Gifts Insight: Shopping Decisions (Canada)

While there was very limited detail about Canadian-specific insights on parental shopping for children's gifts, there was transferable data available regarding parents in the United States. For instance, the data revealed that US parents generally, look for things that will result in smiles or a wow effect from their children; these results are likely very similar to those experienced by Canadian parents. The data presented below is a compilation and analysis of available insights.

THE PARENTAL SHOPPING JOURNEY

  • 1. Many parents ask their children what gifts they would like.
    • Research by the Toy Industry Association revealed that 60% of toy/game purchases are done as part of a plan because children were asked what they wanted. Conversely, approximately 20% of the purchases are as a surprise.
    • Parents ask their children what gifts they want and then based on their answers and age, they help to guide their choices. This leads to arriving at a transparent space since the children will know what exactly they are getting because they came to a decision together with their parents.
    • Parents even come up with strategies such as "Want, Need, Wear, Read" where the parent will obtain gifts based on things a child might need (new backpack), want (toy), wear (new jacket), and/or read (new book). This strategy allows parents to cover the bases on a full range of their children's needs and desires.
    • This direct-ask approach could even soften the blow when a child gets fewer gifts since children might still be happy because they know they had a direct say in what they got.
    • Research by the Toy Industry Association further stated that 21% of parents reported that their kids conveyed the initial idea for the purchased toy by making online wish lists or sending texts/emails with the request.

  • 2. The major influences on parents' gift decision-making processes are affordability/budget constraints, age appropriateness, occasion/holiday/event, and quality.
    • Some parents have guidelines or budgets for a particular holiday already planned out; therefore, when making decisions on what gifts to get for their children they have to abide by the budget thus the cost of a gift is a major influence.
    • Other parents also consider the age-appropriateness of the gift. For example, transformers are great, but not for a 5-year-old who hasn’t mastered fine motor skills yet.

  • 3. Experimental gifts (like ones that will allow the children or entire family to do something special) and practical gifts (like a winter coat the child needs anyway) have the highest parental consideration.
    • Some parents also highly consider gifts that give back by helping their kids find organizations based on things they care about such as animals or the environment; this allows the children to feel good about their own contribution or donation to something that matters to them.

  • 4. Where parents do their shopping depends on several factors: is the season a busy one, which stores have the best offers, and whether they can bargain hunt.
    • Because some holiday seasons are usually busy, some parents tend to choose and shop for their gifts online to avoid the crowded streets.
    • Moreover, with products constantly in flux during this busy shopping season, 40% of holiday shoppers wish that stores would do a better job of sharing inventory information online.
    • Although it is not specific to buying for kids, MarTech Today has a visual tool of three holiday gift-buying personas which are relevant in understanding how to target holiday gift-buyers. The tool showed that bargain shoppers are most open to trying new retailers.
    • Think with Google, a marketing research and trends newsletter, reported that 18% of shoppers purchase all their gifts between Black Friday and Cyber Monday and this proves that some buyers will tend to shop in stores that have a great offer.

ADDITIONAL ANALYSIS

  • Generally, when searching for gifts, people look for things that will result in smiles or a wow effect even when other options are more likely to bring recipients the greatest satisfaction.
  • A leading researcher in the space, Adelle Yang, said that a study revealed the pleasure that people derive from others’ display of emotions is more powerful than previously considered thus explaining the need to get people gifts that are "smile-seeking".
  • Moreover, findings from other studies also revealed that the givers’ preferences for gifts with a wow factor disappeared when they learned that they wouldn’t be able to see the recipient’s reaction.
  • The above findings prove how the gift-buying journey can be complicated and this can get even more difficult for parents shopping for their children's gifts (i.e., the parents can find it hectic and sad to see the disappointment in their kids' faces).

Research Strategy:

When starting the research to compile insights on the gift-buying journey of Canadian parents when shopping for their kids, the research team looked through case studies, blogs, articles, leading publications, and industry-related data available in business and company-based databases. Unfortunately, we did not locate credible and relevant sources that provided or added value to the topic of the parent-kid gift shopping journey. We then moved the search to review advanced resources and other databases and media reports but we were still unable to find sources with precompiled information about the journey that Canadian parents go through when shopping for their children. We were, however, able to find data for parents in the United States. From that research, we compiled our analysis.
Sources
Sources

From Part 02
Quotes
  • "Gift givers tend to focus on the “big reveal,” leading them to choose whichever gift is more likely to surprise and delight the recipient in the moment "
Quotes
  • "We found that givers often chose to forgo satisfaction-maximizing gifts and instead favor reaction-maximizing gifts. "
Quotes
  • "My kids often have very specific ideas of what they want for the holidays. So when they didn’t get exactly what they wanted, it meant a tantrum or a meltdown."
Quotes
  • " A great way to choose gifts without stress is to shop online; if you want to take her on a special shopping trip, head out in the morning before the stores get too crowded"