£4.5 billion wasted on Christmas shopping says ABS head
Think twice before splashing out on that Christmas present for the person who has everything.
A Birmingham-based marketing expert has claimed that festive shoppers in the UK waste £4.5 billion each year on worthless gifts.
Professor John Saunders, head of Aston Business School, has estimated that unwanted gifts and inflated seasonal prices cost givers at least £76 each.
“What is the point in someone spending £10 on a pair of socks or a book whose only impact on the recipient is storing an item they do not want?” asked Prof Saunders, co-author of Europe’s best-selling marketing text, Principles of Marketing.
“The phenomenon is known as the deadweight loss of Christmas and one reason for it is that we end up buying either stuff we know nothing about or for people we do not know very well.”
In a US survey, economists found that recipients would have paid an average of £207 for the gifts they received but the estimated costs of the presents was actually £283 – a ‘deadweight loss’ of £76 each.
“For the
“Our ignorance means that top brands sell especially well at Christmas. They maybe do not fit with what people want but at least top brands usually perform well and signal expense. It is the same principle that keeps Chanel as the top selling fragrance at airports, it is the one people are most likely to have heard of, and because it is most widely purchased, it must be a ‘safe’ buy.”
Adding to this effectare inflated seasonal prices. “Economists, and many others, believe that prices go down the more you buy but this simple rule is often broken. We all know about selection boxes of confectionary where it is cheaper to buy the individual items and yet we buy loads of these.
“As a marketer I have no problems with Christmas and the pursuit of fun and happiness but economists like to reduce everything to a few simple principles.
“They have real problems understanding why we do things like leave tips at restaurants we do not expect to visit again, look after elderly relatives or give Christmas presents.”
The study is part of the diverse and internationally-focused research activity at the
So if you are still looking for the ideal gift, Prof Saunders has some simple advice - maybe it's time to consider cash.
“To an economist the only sensible present would be money because the cash retains its value when exchanged,” he added.
“In fact it can be seen as being worth more than its face value because it can buy what someone really wants.”
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