We have a similar issue, somewhat on steroids now that we have kids of our own. Plus, all of our parents are divorced meaning we get it 4x over. We've worked hard to set some limits, otherwise our house would be overrun with cheap stuffed animals and plastic toys.
First, we ask them to check with us before buying anything. To make this fair, we try and maintain a list so that we can give good suggestions when asked (and can avoid flat out saying 'no'). Some items that we've found work best:
Memberships to local organizations are great. Zoos, museums, concerts in the park, etc. This is especially true for kids, but also a nice gift for adults.
Magazine or book subscriptions. Again, great for kids, OK for adults.
Donate to charity in our name. Simple and effective and results in us not accumulating random stuff we don't need or want.
Visits. Spend the money to buy a flight and come see us!
In the end we still end up with 'stuff', but it's less than it used to be and we just donate the excess every year or so.