Promotional merchandise gift hampers: Food for thought

by James Quilter , Promotions & Incentives 19-Aug-09

Gift-hamper firms benefit from seasonal demand from marketers looking to build relationships with key stakeholders. James Quilter asks whether they are immune from the downturn.

From multinationals to the individual on the street, no one has been immune from the ravages of the recession. However, the Christmas gift-hampers sector can lay claim to being one of the few yet to show significant signs of strain. Its products' position as a once-a-year purchase has, until now, kept it largely insulated from the world's financial troubles.

Claire Skinner, managing director of Spicers of Hythe, says last year was a sell-out, primarily because the majority of hampers are ordered in the autumn. This Christmas will be the first time the sector has felt the squeeze created by the spending cuts affecting many businesses. 'We are aware things will be different this time around,' she says.

To counter this, Spicers, and many other suppliers, are adapting their product ranges to ride out the storm. The result could spark a transformation in corporate hamper ranges as the lower end of the price scale evolves.

Bespoke hampers have become popular as buyers look to individualise their corporate gifts. The challenge is to do this by economically sourcing quality goods and packaging them in an innovative way.

'We launched our Star Buys hamper range last year,' says Skinner. 'It's £25 and all comes from small manufacturers. Hampers allow you to downgrade without it feeling like you've bought everything in a pound shop.'

Another supplier, Hay Hampers, which specialises in wine, said sterling's falling value against the Euro has meant it has had to select its products with extra care, too.

'We've gone to places like South Africa - even though it is further, it still presents better value for money,' says Hay managing director Rachel Marshall Roberts. 'People tend to have an idea of what they want to spend, and we'll create a basket for them around that.'

In recent years there has been a significant rise in the inclusion of Fairtrade and ethical products. However, both Skinner and Marshall Roberts say they are moving away from this due to the economic climate, with Skinner saying she prefers to fill hampers with quality items.

'We are doing Fairtrade, but we're not putting it in the brochure this year,' she says. 'It is marginal and, to be frank, not only is a lot of the packaging bad, but you can buy it in your local Sainsbury's. There is a limit to how many Fairtrade suppliers you can go to. We want to get things you can't buy in the shops.'

Marshall Roberts notes a decline in organic hampers but says there is still a market for some types of ethical product. As a result, Hay Hampers is planning to introduce wines created according to the tenets of biodynamic agriculture, a version of organic farming. Its adherents believe that farms should be treated as a whole organism. The wine production technique includes such treatments as laying out the ashes of field mice when Venus is in the constellation of Scorpio to deter vermin.

Affordable options

John Lewis, on the other hand, is planning to continue to push Fairtrade products. It has recently introduced a bargain hamper that includes solely ethical products.

Manoj Jadeja, national account manager for John Lewis, says the retailer is launching a Fairtrade Christmas tray for £25.

'From the consumer point of view, organic has always been premium,' he says. 'We have been clever about combining all the elements. Fairtrade was very popular last year, so it was a no-brainer to go with it this year. We've been responding to (the economy) very early, and when our range comes out, the consumer will see a lot of choice around the £40 to £70 mark.'

It is doubtful that any records will be broken this year, but the collapse in 'thank you budgets' may help the hampers market take money that might normally have been earmarked for trips abroad, and lavish corporate hospitality.

The collapse of the financial and property sectors is likely to hit the industry hard, but even in tough times there are always companies looking to send thank-you gifts to clients. These include the publishing and chemicals sectors, while finance is still likely to figure highly. As Marshall Roberts puts it: 'It's a leaky bucket, but we're not dependent on a particular industry.'

HAMPERED IN STYLE

Luxury hampers sector remains buoyant

While the bottom end of the market might be undergoing a shift, most agree that at the premium end, little has changed.

John Lewis' range goes up to the £500 mark, where the hamper may include non-food items such as candlesticks, crystal glasses and china tableware.

The super-luxury end of the market is holding up well, with some hampers costing thousands of pounds. Fortnum & Mason produces a £20,000 hamper, although its standard expensive version is £500. This was topped by London restaurant Vivat Bacchus. Following a customer enquiry, it produced a hamper to a £50,000 budget, which included a bottle of Burgundy worth £15,000.

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