A lot of people here do no gifts. We asked for donations of kids/mom stuff for a local women's shelter we volunteer at for my DD1s first two birthdays. We had about a third of people donate, a third bring gifts and a third bring nothing. After that we got hip to the 'book exchange' trend. Basically each kid (who wants to participate) brings a wrapped book. After cake, every kiddo picks a book and opens it. (We buy several extras in case someone didn't bring one). We also cut out junky goody bags. They get a book from the exchange and something related to the party theme. IE: playsilks for DD2s rainbow party, DJ Lance glasses and microphones for the YGG party, jumpropes/hats/bandannas for the western party. It seems to be a big hit. People have been excited about it the last couple parties we've done it for.