Shoppers scrimp or splurge for dad

Consumers shopping for Father's Day gifts generally fall into two camps this year -- those looking to splurge on their dads and those searching for a bargain.

That is, at least, the opinion of insiders with a finger on the pulse on the retail industry. They say the economic downturn has forced lower income customers to search for bargain gifts, while the spending habits of the well-off haven't been affected by the nation's ongoing slump.

"For example, for shavers, our best-selling products are the National ES3042 shaver priced at NT$988 and the Philips HQ8885 model priced at NT$8,800," said Fiona Wang (王彤芳), marketing manager at RT-Mart (大潤發), a French-Taiwanese hypermarket joint venture.

Lily Lee (李莉莉), public relations manager at Carrefour Taiwan, agreed that consumer buying habits have become polarized. She said shoppers either budgeted less than NT$5,000 for Father's Day gifts or more than NT$10,000.

"For instance, our blood-pressure machines and shavers -- priced between NT$1,000 and NT$3,000 -- were favored by students," Lee said. "Middle-income consumers favored massage chairs priced at around NT$10,000 as Father's Day gifts."

A professor of business administration at National Chengchi University said lower income consumers are more sensitive to tough times, while the wealthy rarely feel the need to tighten their belts during a downturn.

"The majority of people will turn to discount stores such as hypermarts for shopping," said Bei Lien-ti (別蓮蒂), an associate professor at Chengchi.

According to Wang, RT-Mart sold roughly 20,000 shavers in the weekend before today's Father's Day holiday, generating nearly NT$40 million in sales.

"For Father's Day sales, we have a target of selling around NT$80 million in shavers, which should account for more than 60 percent of RT-Mart's shaver sales this year," Wang said.

Wang said that since the downturn began early last year, consumers have turned to hypermarts for electronics instead of shopping at department stores.

"Hypermarts are well-known for discounts and are very attractive to bargain hunters," she said.

That leaves high-priced products for the department stores.

"Some of our luxury massage chair models priced at NT$112,800 are already out of stock," said Brent Chen (陳全議), director at Osim Taiwan Co.

"The market reaction has been great. For example, on Sunday, one of our retail outlets at Sogo Department Store (太平洋崇光百貨) received 10 orders, generating more than NT$1 million in sales on that day," Chen said.

To lure customers on a tight budget, Osim offers an installment payment plan. "For the first time, we're allowing customers to pay in 15 monthly installments without interest charges," he said.

The promotion has helped to lift sales, Chen said, noting that more than 60 percent of its customers choose to pay by installments.

"After realizing I only have to pay NT$7,520 every month, I decided to buy," said Lin Shu-fen (林淑芬), 30, an assistant professor at Soochow University.

Lin, who said the massage chair was the most expensive Father's Day gift she had ever bought, said "it's worth it, because not only my father but all of my family can enjoy the massage chair."