Every late spring to early summer, millions of young adults begin a new stage in life by graduating from high school or college. Friends and family give gifts both to celebrate this important milestone and to help smooth the transition to higher education or the workplace.
How can retailers capture a bigger piece of this important $5 billion market? By being aware of the trends in graduation gift giving, and identifying the best way to capitalize on them, of course!
Who gives graduation gifts?
The biggest spending on graduation comes from the 43-55 age bracket, probably largely consisting of the parents of the graduating students. But younger shoppers, including the siblings and peers of students, also shop for graduation gifts.
Knowing the demographics of your audience can go a long way to helping you decide how to target your graduation season marketing campaigns. If consumer data analysis shows that the majority of your customers are in the 43-55 range, you can likely count on them to be in the market for more extravagant graduation gifts, whereas a younger customer base may be interested in gifts that are more affordable but highly individualized.
What are the most popular graduation gifts?
Although cash is a traditional gift and remains popular (what young adult couldn’t use some more money, especially if they’re preparing to move into a new home after school?), the retail sector still sees a shopping boost around graduation.
The three most popular graduation purchases are gift cards, apparel, and electronics, capturing 32%, 14%, and 10% of the market, respectively.
Gift cards are the natural extension of the cash gift. They allow the giver to customize the gift to the graduate’s need or interests, while still giving them the freedom to buy exactly what they like. These are especially a popular gift because of how easy they are to mail or deliver electronically, whether via email or directly through payment apps such as Apple Pay, Android Pay, and Samsung Pay.
Retailers have several options for driving extra gift card sales. The most popular choice is to offer bonuses. The aforementioned payment apps offer deals wherein one can purchase a $50 gift card for only $40, for instance. Another popular option is to offer a free $20 gift card with the purchase of a $100 card, allowing the purchaser to either gift the bonus card or use it themselves for a future purchase.
As for the apparel sector, graduation offers several possibilities. Depending on the style of clothing offered, a retailer may find opportunity to market towards graduates looking for something special to wear to celebrations, or those looking to build a professional wardrobe for their post-school career.
Electronic gifts can include the latest smartphones, a new laptop (especially popular for high school grads heading to college), or a nice TV for the dorm room.
Although these three sectors dominate graduation spending, other retailers needn’t lose heart. Restaurants can capitalize on the desire for families to celebrate together over a good meal, and the travel industry can play off of the fact that Millennial and Gen Z graduates often prefer experiences over physical goods—meaning they want to spend their cash gifts on a summer vacation!
Preparing for graduation season shoppers
When preparing for graduation season, retailers need to not only plan their marketing campaigns, but be sure that their website and/or mobile app is up to the task of handling all of these shoppers. Mobile commerce is expected to account for approximately 45% of graduation-related purchases, so it is especially important to ensure that your website is mobile-friendly, and your app is updated with your graduation promotions.
Today’s consumer has more options than ever when it comes to online shopping, which means they’re quicker than ever to go to a competitor if they encounter a problem. If a potential customer gets an error when they attempt to purchase a gift card, or if the item they want to order as a gift has been out of stock for over a week, they may choose to shop elsewhere.
Customer journey analytics can help you determine when and where customers are experiencing problems on your site. If you find that customers are abandoning their carts when it comes time to submit payment details, it may be time to add more payment options, or make the options clearer. Likewise, if they cancel the transaction after reaching the shipping page, it may be time to consider changing your shipping prices or adding more fast options for those last-minute gifts.
Many of today’s shoppers enjoy a hybrid shopping experience, where they research online and then make the final purchase in the store. This combines the best of both worlds, as they can research specs and read reviews, then have the hands-on experience of seeing how an item actually looks and feels. For those retailers with a physical presence, does your site make it easy to set up in-store pick-up, or to check whether an item is in stock? For those with retail partners, is it easy to find which stores carry your products?
Graduation is one of the most important milestones in a person’s life. Make sure your website is ready to be a part of the celebration!
Glassbox Digital provides customer experience analytics software for online retailers.