Giving Great Gifts is Hard
Let’s be honest, very few people are talented at giving gifts. Most of us give gifts that we think are cool, neat, trendy, look good sitting on a table or affixed to a wall.. Gift-giving is often compulsory and inefficient. Searching for gifts, staying up-to-date on trends and new products, it’s time consuming.
When economists discuss gift-giving, they talk about “deadweight loss”. This is the idea that it’s more likely that the gift giver is not perfectly informed, and will choose a gift that the recipient does not value at its cost and thus would not have chosen it for themselves knowing the cost. Essentially, they won’t use it and you may never see it again. Deadweight loss is the concept that Peter paid $100 to buy wall art for Jake, but Jake sees the value as $20 because he doesn’t have a particular interest for art and he lives in an apartment so once he puts holes in the wall to affix the art – it will cost him out of his security deposit for repairs. That’s an $80 deadweight loss, where from an economics standpoint the gift had an inefficiency of 80%.
What makes a great gift?
We created Giftata because many people don’t know how to answer this question for themselves, let alone others. When surveying people on their favorite gifts, many respond with “gift card” or “cash”. Digging deeper, we’ve discovered that the reason people give those answers is because thoughtless, simple gifts are better than receiving a gift you’ll literally never look at, or use, and want to return.
So, what makes a great gift? First ask yourself, “will they use it?”. You want to give a gift that will be used time and time again! Does the gift show that you know the person? Does it show that you thought about them? Considered their lifestyle? Their interests? What they use currently or what in their life could use an upgrade?
How to choose the right gift
Similar to determining “what makes a great gift”, choosing the right gift comes down to understanding your giftee, their situation, and their life stage. Bath bombs can make for great gifts, but not if they don’t have a bath tub.
Work equipment like nice wrist rest pads are generally thoughtful, but if they don’t work from a computer or laptop often (or) already have nice wrist rests supplied by their office – chances are they won’t enjoy the gift.
Are you buying a gift for a homeowner or for someone leasing an apartment? Well, if you’re looking at gifts for someone that doesn’t own their home, it’s important to consider that any home products (ie: wall art) or home improvement products (ie: TV wall mount) that cause damage will ultimately cost them for repairs later on when they move. That additional cost is either going to be out of their pocket or their security deposit, which is likely reason enough to encourage them to never use it and it could get lost or tossed in between now and the time they purchase a home.
Lastly, let’s address gift cards! Consider your last Amazon gift card – what did you buy with it? It’s ok if you don’t remember, almost no one does! Now, even if you do remember, do you attribute what you bought with that gift card to the person that gifted you the gift card? No, of course not! Because you made the decision on what to buy, therefore removing any warm feelings of the gift being thoughtful. Now with that being said, it’s important to clarify that there are of course exceptions – A gift card to someone’s favorite restaurant, which covers the entire meal cost (and more), is often thoughtful. It’s especially thoughtful because you know somewhere they enjoy eating, and you’re forcing them to be treated to a meal there.
Whenever giving a gift card, please consider that if it doesn’t cover what they want to buy from that retailer or restaurant – You’re actually forcing them to spend more money on something that probably wasn’t their first choice in how they wanted to spend their money, just to redeem the gift card you gave them.
Now, I hope that none of this comes across as setting a precedent where people receiving gifts deserve to be ungrateful – Any gift received has meaning, because all gifts are given with the greatest intentions from the gift giver! We ONLY give gifts to the people we care about. Giftata is simply here to help gift givers everywhere, make the most of their gift giving gestures.
Four Simple Gift Giving Principles
1) Give a gift that is used frequently
2) Give a gift that reminds the recipient of you when they use it
3) Give a gift that the recipient will be more interested in keeping than reselling
4) Keep it a surprise