The Complex Psychology and Economics of Gifting

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Online gifting technology provider Smartgift has released a report (PDF) that sheds light on how online retailers can use behavioral science to boost revenue.

A few of Smartgift's recommended best practices, along with a nice supported quote, include:

- QUOTE: “Presents are made for the pleasures of who gives them, not the merits of who receives them.”
- BEST PRACTICE: Offer the gift sender more merchandising options at the point of checkout

- QUOTE: “The paradox of gifts: I know what I have given you. I don’t know what you have received.”
- BEST PRACTICE: Let gift recipients choose what they want

- QUOTE: “The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it.”
- BEST PRACTICE: Leverage ratings, reviews, exclusive sales and limited edition products

"Exchanging gifts is the most powerful way of building alliances and stronger bonds. The essence of gifting is based on the self-perpetuating system of balanced reciprocity,” said Monika Kochhar, CEO and co-founder of Smartgift. “Smartgift is rooted in ‘the science of gifting’. The gift economy creates an enormous demand and market for consumer goods throughout the year. In this highly competitive market, retailers that understand gifting behavior are best positioned to maximize their online gift revenue.”

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