I TRIED to buy beefjerky with BTC, but the business owner reneged on the deal.
I TRIED to gamble it all away but couldn't find a fair place to do it that wasn't just some stupid lottery or rigged site.
I TRIED to do lots of things with bitcoins. The only thing I was able to successfully buy with it was USD. Not surprisingly I was easily able to buy beefjerky with these magical USD, and my friends sure did enjoy taking them from me in our poker game.
You didn't try to buy any shirts or stickers.

I ship product all the time and sell items for as little as .2 btc .
I do admit that people hold on to bitcoins pretty tightly. That should change some as they are easier to get with bitinstant and others like them now. I have found the market for services to be more lively then the market for physical items. Logo design, VPN services and of course gambling.
The fairest place I have seen is Satoshi Dice, as the outcome is predicable and the house margin is low and all of the traffic is visible.