Experiential gifts

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Experiential gifts also known as gift experiences and experience gifts, as opposed to material gifts, allow the recipient to have an experience, such as skydiving, kayaking, race car driving or touring a vineyard. Purchases typically take the form of vouchers or gift certificates via email or retailed boxes.

Pioneered in the UK in the 1990s, now represent one of the faster-growing segments of the $253 billion a year gift industry.

Groups[edit]

Experiential gifts fall into a number of categories but the sector is always innovating and introducing new experiences :[citation needed]

History[edit]

One of the pioneers of the industry[according to whom?] was the United Kingdom-based Red Letter Days, which rose to meteoric[citation needed] heights before crashing down to virtual bankruptcy. Red Letter Days was founded in 1989 by British entrepreneur Rachel Elnaugh, who reportedly came up with the idea of gift experiences after looking for a creative way to give her father tickets to an England cricket team match.[1] The success of Red Letter Days led to Elnaugh winning the Ernst & Young Entrepreneur of the Year Award in 2002 and a role as a Dragon on BBCTV's Dragon's Den.[2] Red Letter Days was purchased out of administration in August 2005 by Theo Paphitis and Peter Jones, who were also Dragons on the BBCTV show.[3]The heavily indebted business was turned round under a new Chief Executive, returned to profitability and sold to its major international rival, Smartbox Group, in 2017.

Acorne Sports was founded in the same year as Red Letter Days. Later renamed Virgin Experience Days, it was bought by private equity investors Inflexion in 2017.

Activity Superstore is the leading supplier of gift experiences to the retail sector, and specialist digital agencies including Trackdays.co.uk and Into the Blue focus on popular experience categories such as driving and flying.

Experience gift companies launched across Europe following the success of Red Letter Days and the largest Australian experience gift company, RedBalloon, was founded in 2001.[citation needed] By 2010, nearly all EU countries had an established experience gift provider from the larger states such as Germany through to the small countries such as Cyprus.[citation needed]. There are a number of international gift experience brands such as the market leading Smartbox Group and the small privately owned on pack promotion specialists Golden Moments.

While popular in both Europe and Australia, the idea of experience gifts did not hit the mainstream in the US until 2004–2005. Between 2004 and 2005, the four largest US-based experience gift companies – Great American Days (2004), Excitations (2005) Cloud 9 Living (2005), Xperience Days (2004) – were founded. All four continue to operate today.[citation needed]Geographical challenges, cultural differences and state legislation on gift vouchers and gift cards make the US a complex market to operate in.

Market surveys[edit]

As of 2009, the experiential gift market is an established, highly competitive multimillion-dollar market in the United Kingdom and in Australia and an emerging category in the U.S.A.[citation needed]

A survey conducted in November 2005 by American Express found that experiential gift giving was on the rise: 30% of those surveyed planned on giving experiential gifts that year versus 23% the prior year.[4] The survey also found that experiential gifts were particularly popular among consumers aged 18–44. A survey published in 2007 by Mintel estimated the UK gift experience market to be worth £98 million but by 2018, just over ten years later, the combined U.K. sales of gift experiences by the major gift experience agencies, Buyagift, Red Letter Days, Virgin and Activity Superstore exceeded £125 million..[5]

According to the same American Express survey, the growth of interest in buying experience gifts in the UK is:

Year Growth
2001 18%
2002 20%
2003 20%
2004 22%
2005 23%
2006 30%
2007 34%
2008 35.5%

[citation needed]

Experiential gifts also capitalise on consumers' growing comfort with purchasing gifts online. According to a December 2012 survey, 69 percent of UK experience days were bought online.[6]

See also[edit]

References[edit]

  1. ^ "Rachel Elnaugh interview". web.archive.org. 2007-10-14. Retrieved 2019-01-17.
  2. ^ "Biography". Rachel Elnaugh. Retrieved 17 January 2019.
  3. ^ https://m.imdb.com/title/tt0443370/fullcredits/cast?ref_=m_ttfc_2
  4. ^ "Gift Cards Change How Holiday Shoppers Shop, Shift Consumer Mindset, According to 2005 American Express Gift Card Survey". American Express. Nov 10, 2005. Retrieved 8 December 2016.
  5. ^ [1]
  6. ^ [2]