December 1

[Nugget #11] Gift givers are a gift.

Xmas is around the corner. Imagine you are buying the perfect gift – let us say a lush beauty product – for your loved ones. How do you feel towards the brand? Now, assume you would have bought the same product for yourself and personal use. How do you think about the brand in this case?

When buying a product as a gift, Eggert/Steinhoff/Witte (2019) found that customers feel a greater sense of gratitude and commitment towards the brand compared to buying the same product for personal use: more gratitude, because the brand helped you to find the perfect gift; more commitment, because you publicly declare that the product is appropriate by presenting it as a gift.

You bought the product as a gift. How do you behave afterwards?

The researchers found – because of elevated levels of gratitude and commitment – that customers have a more positive attitude towards the brand which translates into higher purchase intentions.

More specifically, in the year following the gift purchase, gift buyers bought more often, spend more per shopping trip and bought more different products. Overall, gift buyers spent 63% more on the particular brand the year after buying a gift than customers who bought the same product for personal use.

What does this mean for your business? Make people gifting your products – they come back more often, spend more on your brand and become more loyal.

Eggert, Andreas, Lena Steinhoff, and Carina Witte (2019), “Gift purchases as catalysts for strengthening customer-brand relationships,” Journal of Marketing, 83(5), 115-132.

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