December 2023

Are In-Budget Gift Choices Getting More And More Out of Reach? Blame Inflation

photo courtesy of Clip Art Library

By Nathan Marvin

During the holiday season, people (especially parents) make exceptions when it comes to financial decisions. Parents buy presents for their children and end up spending different amounts of money depending on how many kids they have, or how much tolerance they have for the amount of money they’re spending. 

However, in the 21st century, products are overpriced now (which could cause a lot of parents' tolerance for gifts to drop a little); the reason for this is inflation. Inflation is a marketing problem in which all products that cost a certain amount of money will become more expensive, while the product stays exactly the same. 

This then leads to another marketing problem called shrinkflation, which is basically inflation but worse. Shrinkflation means that the same products get smaller in size while the price stays the same; it's exactly like buying a overpriced item.

Nevertheless, gift giving is a staple of this holiday season; whether you celebrate Christmas or Hanukkah, you will inevitably buy or receive a gift during this time of year.

However, inflation is a huge problem for holiday shopping because inflation affects food products, as well as toys and other various gift items. If you are ever questioning whether you spent more money on this year's holiday than previous years, all you have to do is compare it to the previous sizes of those items.

Around this time, customers are drawn in by watching Black Friday sales and Christmas sales, which leads them to go out shopping for presents and even telling other people about how low the prices are. Obviously, the people who spend a lot of money at stores are the market's favorite kinds of people, because spending more money on products means more profit. 🐾