Some Philly shoppers are taking ‘a more minimalistic approach’ to buying gifts this holiday season

Lillian Gil used to spend about $1,000 each year on holiday gifts for her large extended family.

This year, the 34-year-old has shrunk her list, and plans to spend no more than $150 total. She plans to get her boyfriend a plant for their apartment, she said, and will buy her two siblings small gifts that they can take home in their suitcases when they visit.

“We’re following a more minimalistic approach,” Gil said, though her decision was also a financial one. She relocated to Francisville from Dallas in May.

“This year with the move it has been a struggle finding a job,” she said, and the increased cost of essentials such as groceries “has impacted my budget.”

Across the country, people are feeling the crunch of inflation with more households reporting economic difficulties this year than last. That includes trouble paying for necessary expenses such as food, gas, and utilities. At the same time, the price of holiday experiences, entertaining, travel, and gifts has jumped. The cost of airfare is up more than 42%, and gift wrapping and shipping have increased about 13%, according to Bankrate.com analysis of November data from the Department of Labor.

Yet in the Philadelphia area, consumers went into the holiday season planning to spend just 3% less than last year, according to a Deloitte survey of nearly 5,000 local shoppers. Respondents planned to cut back on the number of gifts given to 10 on average, compared with 19 last year.

Retailers, concerned about how tight budgets would impact their bottom lines, tried particularly hard this year to woo customers with early Black Friday and Cyber Monday deals while they still had money to spend. And initial signs point to some shoppers opening their wallets despite economic concerns.

» READ MORE: Many Philly retailers started Black Friday sales weeks early, hoping ‘buzz’ would drive demand

Sales on Black Friday rose 12% over last year — though that number is not adjusted for inflation, according to the Wall Street Journal, citing Mastercard SpendingPulse data, and the day was described as “lukewarm” by one national retail consultant. Cyber Monday sales hit $11.3 billion, a record day for online shopping, according to Adobe Analytics, with sales up 5.8% from last year, a figure also not adjusted for inflation.

Although it is too soon to tell just how much economic uncertainty will affect overall holiday spending this year, it has changed the way people are approaching gift-giving, said Sheri Lambert, associate professor of marketing at Temple University’s Fox School of Business.

Consumers this year want to make the experience “less painful” and “more palatable,” she said, by spreading out gift purchases, bargain hunting, and focusing on value — both getting “bang for their buck” and adding worth to the lives of the recipients, and sometimes the givers, too.

“In the past, people spent money on high-ticket items,” Lambert said “Now, I’m seeing a lot of people are spending money on experiential gifts. … They’re going ax-throwing or doing escape rooms. They’re buying concert tickets, if they can get them.”

“Part of what is driving that is money,” she said, and part of it is “people are tired of being indoors” more than two years into the pandemic.

Most years, Shaun Fishburn and his wife, Monica Sweeney, who are both 41, have completely different approaches to holiday shopping. Sweeney gets most of her shopping done between Black Friday and Cyber Monday. Fishburn waits until a week or two before Christmas and braves the crowds at the mall for a single day, during which he attempts to get gifts for everyone on his list.

This year, however, the King of Prussia couple could agree on one thing: spending less.

“I would love to spend as much as I’ve done in the past, but I am cutting back,” Fishburn said, citing increased costs elsewhere and his move this summer to start his own engineering company.

For their 2-year-old daughter, Cosima, there won’t be tons of boxes stacked under the tree. Instead, they said, they plan to give her experiences, such as trips to the zoo.

“She has so many toys, new toys and hand-me-downs from relatives and friends. She plays with them for a little bit and they pile up. It’s kind of wasteful,” said Sweeney, who is also an engineer. “It’s nice to get her out to do things. … She was born pretty much into the pandemic, so for her first year of her life she didn’t really go anywhere.”

In Francisville, Tiffany King, 41, is cutting back on gifts, too. She flies home to Georgia for Christmas every year, she said, and airfare was more expensive this year than in the past — so much more expensive that she is taking an Amtrak train back to Philadelphia.

“I usually spend over $100 per person [on gifts], but I don’t really budget it,” said King, a manager in SEPTA’s Senior Disadvantaged Business Enterprise Program Office. Now, “my thought is more like $50 cash per person.”

“I think this year I’ll actually have a budget,” she said with a laugh.

In Havertown, Aino Assmus thought she would be saving money this year as she, like Fishburn and Sweeney, focused more on giving experiences and nearly eliminated physical gift-giving, aside from a few “stocking stuffers.”

The 54-year-old and her husband bought their teenage daughter tickets to Taylor Swift’s May concert in Philadelphia, Assmus said, and plan to take her on a trip.

“In the end, it doesn’t make a difference [financially] compared to the last two years,” said Assmus, who owns a real estate photography and staging services company. She anticipates that by the time Christmas arrives, with the costs of a trip factored in, she will end up spending about as much as she did last year.

This year, however, she will no longer give gifts to friends and extended family, decision that’s as much a byproduct of changing priorities as it is the economy.

“It’s more about spending time with other people, doing potlucks and having friends over,” she said. “Definitely the pandemic has created this need” for togetherness.

It’s unclear what these early trends will mean for the rest of the holiday season and the start of 2023, as the country sees interest rates continue to climb and layoffs hit some sectors such as technology and banking.

People have an increasingly pessimistic view about their own financial situations and the economy at large, according to the latest University of Michigan survey on consumer sentiment, released in mid-November.

In the report, Joanne Hsu, director of the surveys of consumers, wrote that “along with the ongoing impact of inflation, consumer attitudes have also been weighed down by rising borrowing costs, declining asset values, and weakening labor market expectations.”

For now, “they’re spending, which is good for the economy,” Temple’s Lambert said, though she’s concerned that most people won’t continue spending.

“Even if it’s not buy-now, pay-later, they’re putting [these purchases] on their credit cards and they’re going to be paying for it come January,” Lambert said. For some, “I think that’s going to be tough.”