The business of gifting

As the season of Diwali approaches, the first festival marketing campaign that caught my eye came from an unexpected quarter – Amazon ran a huge full-page advertisement last week, promoting the Kindle book reader as the ideal gift for the upcoming festival of lights. The Kindle is as far as you can get from traditional boxes of mithai and dry fruit, but it goes to show that gifting has really spread its wings in India.

Most of us will recall memorable festival gifting campaigns by brands such as Cadburys, Raymond and Titan which have struck a chord with us, and which took gifting into areas that were quite unconventional for India at those points in time. No wonder then that Kindles or iPhones are the new gifts on the block. Marketing activity on this front will, of course, hot up very soon, as the biggest gifting seasons are just ahead of us – Diwali, Christmas, New Year, the winter wedding season and Valentine’s Day are all packed into the next four months.

As brands prepare to position themselves as ideal gifts for these seasons, it would be worthwhile for marketers to remember that not all gifts are alike. Indeed, the fundamental reasons why people gift are very diverse from each other. Therefore, brands which wish to target gifting sharply and very successfully will have to decide which of these “gifting rationales” should be their primary target. Unless they do this, marketers may find that they are caught up in a large and undifferentiated sea of gifting, with little or no traction.

So, what are the fundamental drivers which lead people to gift products to others? Which product categories can potentially leverage each of these segments? Here is a brief exploration of a very interesting space.

Intimate love and commitment

Gifts between spouses or partners, or parents and children, can convey intimate love and strong commitment. By nature, such gifts tend to be very precious, both for the giver and the recipient. The value of the gift is a surrogate for the preciousness of the intimate relationship. De Beers understood this, and famously used this driver of gifting brilliantly when it said “Diamonds are forever”, thereby positioning these expensive sparkling stones as the ultimate gift for lifelong commitment. Brands of jewellery, luxury accessories, watches and perfumes, cars and even homes, can consider leveraging this driver of gifting, and accomplishing for themselves what De Beers did for diamonds. Customisation (engraving, designs specially created for the receiver, and such) makes these intimate gifts even more special.

Emotional bonding

Emotional bonding and affection between close friends or relatives is quite distinct from intimate love or commitment, and operates at a far lower level of intensity. Yet it is also a major reason for gifting. Cadbury’s chocolates operates in this space, as do Archies and Hallmark, which offer a variety of toys or greeting cards. Here, the gift represents a token of affection, and may or may not be of significant monetary value. What is important is the ability of the gift to convey emotion – chocolates or flowers or well-designed cards naturally tend to do that very well. Product categories such as mobile phones, wine, gift packs of specialty coffees or teas, or apparel are also excellent choices that can leverage and feed this sentiment.

Tradition

Sometimes, just the sheer force of tradition is a key driver of gifting. We are expected to gift at a wedding, or at the time of the Diwali festival, or at the naming ceremony of a child, or at a wedding anniversary event that we have been called to. Going without a gift to such occasions somehow appears cheap, incomplete and even awkward, and hence, this is the imperative that drives gifting. In many such cases, there may be no emotional bonding or deep friendship involved, just the sheer force of tradition. The gift must look large enough, must convey reasonable value commensurate with status, and ideally it must also be of some utility to the recipient. Several brands of cooking utensils and crockery fall in this segment, and, despite my limited knowledge, I am sure millions of Prestige or Hawkins pressure cookers have been gifted at Indian weddings!

Intellectual relationships

Intellectual bonding or professional relationships between workplace colleagues, friends and business associates also leads to gifting. Such gifting is meant to sincerely express the relationship in as platonic a manner as possible. Gifts must represent, in some way, the essence of the intellectual or professional partnership, while not straying into emotional space. The product being gifted must also acknowledge the interests of the recipient.

Books are a popular choice, because they are considered intellectual, can be chosen carefully, and are relatively inexpensive – hence, brands such as Penguin, Hachette and Rupa can all consider actively targeting this space. Kindles, audio books, movie or music CDs, may all fall in this category as well.

Bribes

Like it or not, bribing is a key driver of gifting in our country. Thousands of businessmen purchase gifts for people in positions of authority, in anticipation of a quid pro quo, or to cultivate a deeper friendship that can yield some material benefit in the future. Here, the gift is nothing but a bribe in disguise. Typically, these gifts tend to be of high value, because the bribe has to be seen as substantial, for it to have the desired effect. The gifts must also have prestige value – hence, imported Scotch or single malt, branded gold jewellery, famous luxury brands of wrist watches or pens are favoured products. It would, of course, be entirely unethical and foolish for these brands to advertise themselves as preferred bribes, but the same message is often conveyed by harping on the aspirational value of the brand to the target audience involved. Unlike the general run of wedding gifts which tend to be relatively inexpensive but large, these products must be valuable yet relatively small in size, so that they can be carried away inconspicuously.

Token of appreciation

In many companies and similar institutions, a significant reason for gifting to employees or team members is as recognition of some accomplishment or extraordinary effort, or to celebrate a milestone team event. These gifts are tokens of appreciation, to build spirit and morale. Here, gift vouchers are a popular option, because they provide employees freedom to purchase whatever they wish to. Marketers in banks and financial services companies can leverage this very effectively, to create customised gift cards. Brands of restaurants can tap into this opportunity by offering gift vouchers for fine dining. Publishers of books, makers of T-shirts or watches, and marketers of holiday resorts can also leverage this driver of gifting effectively.

Gifting yourself

Finally, a large segment of gifting is all about a person gifting to himself or herself. Self-gifting, to celebrate an achievement or a milestone, is much larger than we would normally imagine. For example, to mark the successful completion of an intense project you have been working on, you could gift yourself a day at the spa or a foreign holiday, an aspirational brand of perfumes or wine, or even that expensive smartphone you have been lusting for. Brands and marketers should wake up and realise that these self-purchases are truly self-gifts, and they should then tailor their products, packaging and communication accordingly.

This is not a comprehensive list of drivers of gifting. People also gift to emphasise their stature or wealth. They gift selflessly to noble causes which they are attached to. Students may make gifts to their professors, as guru dakshina or a mark of respect and gratitude. The important lesson is that marketers should understand the specific triggers for gifting which are relevant to their category, and use these sharp insights to position and sell their wares. Any approach that falls short of this would constitute lazy marketing. Let me sign off by wishing all members of the marketing fraternity a very happy and successful Diwali season!

Harish Bhat is Managing Director and CEO of Tata Global Beverages, and author of Tata Log: Eight Modern Stories from a Timeless Institution. These are his personal views. He can be reached at >bhatharish@hotmail.com

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