Adults plan on giving fewer Christmas gifts, survey says

It seems it doesn't matter much if you've been naughty or nice in 2002, because Santa's sleigh is going to be a whole lot lighter this holiday season. That's according to a new survey by online market research firm InsightExpress, which found that more than one-third of adults plan to buy and give fewer gifts this year.

When they do hit the stores, however, they will be buying practical gifts, such as adult clothing, books and toys. Those who look forward to the fruitcake Great Aunt Millie sends may be out of luck, too. The survey also found that the first group to be cut out of the gift-giving scene this year will be extended family, followed closely by friends.

The survey of 500 Americans conducted Nov. 9-10 found that 35 percent would spend less this holiday season, with most gift-giving focusing on practical items.

Participants cited a tighter personal or household budget (62 percent), the desire to not incur credit card debt (33 percent), being out of work (18 percent), and the general state of the economy (17 percent), as reasons for spending less this holiday season.

"Retailers need to prepare now for new levels of cautious holiday spending behavior by highlighting affordable and sensible gifts," said Lee Smith, president of InsightExpress. "In this year's tighter economy, consumers plan to be more selective regarding the gifts they purchase and for whom."

Participants who will be spending less this holiday season stated they will conserve cash by reducing gift-giving to extended family (68 percent), friends and colleagues (62 percent), spouse (50 percent), children (44 percent).

To further manage expenses, participants also stated they will be spending less on holiday entertainment (52 percent), decorations (48 percent), entertaining in the home (39 percent) and holiday travel (39 percent).

Consistent with good personal financial practices, consumers will be giving practical items this holiday season, including adult clothing (53 percent), toys (49 percent), books (46 percent), music-related items (43 percent), consumer electronics (40 percent) and children's clothing (36 percent).

"Retailers should plan for a back-to-basics' gift-giving season to ensure they will not be stuck with a warehouse full of merchandise in January," Smith said.