By Dr Simon Moore, CEO and Chartered Psychologist at IB
As a chartered psychologist my team and I spend much of our time advising organisations and companies on the psychological reality of their ideas, plans, strategy and values. We help our clients look at things through the workings of the human brain, its emotionally dominant decision-making system and its subservience to unconscious influence (such as bias, ego, and value need fulfilment).
Gifting is one area that we have become increasingly involved with.
Many companies engage with Incentives, rewards, subscription benefits and loyalty advantages in relation to their customers and employees. Considered at a pragmatic, conscious level these types of initiatives should create more positive reactions, perceptions, attitudes and relationships with the intended audience (be that with employees or customers).
There are probably areas of psychology that you might be more familiar with in terms of gifting. Humans are a social species and our survival and success is based on working and living in groups. Empathy is one of the pillars of the psychology of gift-giving. Looking for a present implies trying to understand that person. You’re showing interest in their needs, desires and interests. Empathy also shows you are a caring person – something that is invaluable to a social group – as caring people help and support others.
Resource value is also another positive effect of giving gifts – we demonstrate our worth at sourcing and securing valuable resources. So, we demonstrate our worth to our groups by evidencing that we can not only contribute useful items to it but that we are resourceful in finding these things. This also indicates that I am not a lazy freeloader!
There are other psychological explanations of the benefits of gifting at a less well known more non-conscious level, through the lens of emotional needs and deep seated automatic motivational drivers’ things become more complicated.
The human brain is mostly influenced by the subconscious – we are neither usually aware or accurate in our estimations of how in control we are with our actions and decisions. This is the case with gifting.
So, for example it has been shown in psychological research (Chan & Mogilner, 2017). that giving material gifts do elicit immediate positive responses and appreciation. This visual feedback of appreciation reinforces gifters’ perceptions of the value of the material gift and makes it more likely that they will use material things as the basis of their future gifting. What the research highlighted however was that there was a deeper psychological difference between receiving a material gift and an experiential gift. At a conscious visible level receivers tended to react positively to material gifts – but that this positive emotional reaction quickly eroded over time. In contrast receiving an experiential gift was shown to be better at strengthening the relationship between the giver and recipient, as it produced a deeper more nonconscious emotional reaction that lasted over a much greater period. This also resulted in greater reported feelings of happiness in the receiver for a far longer time period.
Why might this be? Is it that experiential gifts are just perceived as being more valuable or expensive? The answer might well be linked to the fulfilment of our nonconscious needs – motivational aspects of our values and requirements that underpin our emotional experiences and feed into our sense of connectivity, achievement, status, exploration and security. It is not the experience per se that creates that emotional worth but how the experience enables or feeds our non-conscious needs.
Let me give you another example. Some years ago, we worked for a global organisation that had a B2B audience. It wanted to try and build up its relationships with its key clients and decided to initiate some reward/incentive programme. The first iteration of it failed tremendously – it was quite material based (luxury food hampers). So, the organisation asked for our help. The first thing we did was to analyse the non-conscious needs of the clients which placed them into three key need groups: The need for control (which was the largest group), the need for exploration and innovation and status and the need for social inclusion. We then thought about experiential gifts that might support the needs of each of these groups. So, for example for the need for control group we bought them an annual subscription to a digital calendar organiser. It helped them plan their time and predict what lay ahead – without them having to engage with clients and waste time negotiating who was free when and who should be on the call. We also chose gifts against the other two groups. The need for status and innovation group – also got the heads up on new products and ideas/research 2 weeks before anyone else. It maintained their sense of ‘ahead of the curve’ and upheld their status of the fountain of knowledge within their own companies. The feedback was unanimously positive, and the organisation predicted that they got 16% more work from those happy clients than in the previous 3 years combined.
At another non-conscious level, considerations around the ‘effort’ that your receiver has to undergo to benefit from your gist is also psychologically essential. A study by Rim at al (2019) investigated how the level of practicality of the gift related to the satisfaction of it. The researchers looked at gifts like pens—think a high-quality but heavy pen versus an easily transportable but ordinary one—or restaurant gift vouchers to far-away but trendy restaurants, versus close-by but ordinary restaurants. You guessed it, gift recipients felt closer to someone who gave them a more practical gift (that they could spend less effort on accomplishing) compared to a fancier one they would have to invest time and effort in.
The point here is that yes there are different types of gifts, incentives, loyalty benefits etc but the secret to their success is allying them up with the deep-seated nonconscious needs of the person you are gifting to. So, a person who is driven by difference, standing out, being the vanguard or innovator will respond to rewards and gifts that maintain the satisfaction of these driving needs. They will also respond to different ways to ‘earn’ those gifts. So, a gift that is perceived as unique for a client that is different/innovative will not only activate the ‘they get me’ reaction but also avoid the ‘points based’ reward scheme that makes them feel anything but unique and like every other one of your clients! (*pop* the sound of their I feel a special bubble).
Underpinning your subscription, reward or gifting schemes with psychological insights and behavioural design is a worthwhile investment. It might be the difference between whether your gifting succeeds or fails but it will also significantly increase the ROI of building effective customer relationships.
For more information on IB, the Behavioural Strategy Agency, visit our website or contact us.
Chan, C., & Mogilner, C. (2017). Experiential gifts foster stronger social relationships than material gifts. Journal of Consumer Research, 43(6), 913–931.
Rim, S., Min, K. E., Liu, P. J., Chartrand, T. L., & Trope, Y. (2019). The Gift of Psychological Closeness: How Feasible Versus Desirable Gifts Reduce Psychological Distance to the Giver. Personality and Social Psychology Bulletin, 45(3), 360–371
