NPD: Fewer Consumers Plan To Buy Games As Holiday Gifts

Market research company The NPD Group found that only 15 percent of surveyed consumers intend to buy video games and consoles as holiday gifts this year, a noticeable drop from 20 percent last year. The firm's ninth annual survey of consumers’ holiday spending intentions showed reduced interest in all of the top ten gift categories, with electronics taking the biggest hit, as only 24 percent of respondents plan to buy items like televisions and computers as gifts this year versus 16 percent in 2009. Video games and consoles, though, already suffered a dip in consumer interest last year, when the percentage of survey participants who said they would purchase games as gifts dropped slightly from 22 percent in 2008 to 20 percent in 2009. A higher percentage of consumers said they were more likely to buy clothing (42 percent, down from 49 percent), toys (32 percent, down from 34 percent), movies and DVDs (24 percent, down from 29 percent), books (23 percent, down from 28 percent), electronics, and accessories (16 percent, down from 22 percent). With its 15 percent of consumer interest, however, video games remain more popular as potential holiday gift purchases than food (15 percent, down from 18 percent), music (14 percent, down from 21 percent), and fragrances (13 percent, down from 19 percent). NPD also found that 61 percent of consumers intend to spend about as much money this holiday season as they did in 2009 (compared to 59 percent last year), 30 percent plan to spend less (same percentage as 2009), and 9 percent expect to spend more (down from 11 percent last year.) Furthermore, the survey's results show that 62 percent of consumers believe they will do some kind of "homework" before making a purchase, nearly 44 percent will comparison shop before buying a gift, 37 percent will use ads or circulars when looking for gifts, and 33 percent will comparison shop online before going to stores. "Even though the recession is technically over, lingering concerns are keeping consumers in a cautious frame of mind," says NPD's chief industry analyst Marshal Cohen. "We are seeing what I call ‘calculated consumption’, and I believe that it is a consumer mind-set that will be around after holiday shopping is over." Cohen adds, "Again, this year the real challenge is the absence of newness and excitement. The more progressive brands will learn from mistakes of the recent past and ramp up the excitement in their product offerings. And in turn retailers will be looking for those products to ignite consumers’ passion to spend this holiday."