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It's The Thought That Counts: Gifts and Behavioral Economics

Posted by Michael Leis on February 24th, 2011 at 4:12 pm

Ever get a gift from someone that you weren't expecting? What's your next reaction? If you're like me, it's the feeling like you have to do something in return.

In game mechanics, Amy Jo Kim would call that the implied exchange.

In terms of behavioral economics, it's about surprising your customers with gifts like Zappos' expedited shipping at no extra cost. Zappos already knows that they get what's called "skip zone" benefits from UPS because of the volume of stuff they ship. But they hold that information and make it separate from the purchase path so that it becomes a surprise gift.

The gift economy is driving many of today's business successes, like the fiesta movement: driving marketing costs down by changing the way businesses structure relationships into products and gifts.

I am lucky enough to have been invited to talk a little about gifts, surprises, and marketing at DraftFCB as part of John Kenny's excellent series on behavioral economics as part of the Institute of Decision Making. Let's go to the video tape!

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What are your thoughts? Feel free to share them here or on twitter @mleis

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