Gift Giving Ideas to Help Retailers

1. "Some gifts, of course, are basically straightforward economic exchanges. This is the case when we buy a nephew a package of socks because his mother says he needs them.
2. A second important kind of gift is one that tries to create or strengthen a social connection. The classic example is when somebody invites us for dinner and we bring something for the host. It's a way to express our gratitude and to create a social bond with the host.

3. Another category of gift is what I call "paternalistic" gifts—things you think somebody else should have...I think that singing lessons or yoga classes will expand your horizons—and so I buy them for you...A paternalistic gift ignores the preferences of the person getting the gift.

4. A holiday gift can straddle these categories. Instead of picking a book from your sister's Amazon wish list, or giving her what you think she should read, go to a bookstore and try to think like her.

5. My final category of gift is one that somebody really wants but would feel guilty buying for themselves...fancy pens meet this description. I don't use pens that much, but I'd be pleased to get a really nifty one (a Porsche 911 would be OK, too)."

He goes on to advise, "Behavioral economics has one more lesson for gift givers: If your goal is to maximize a social connection, don't give a perishable gift like flowers or chocolates. True, people enjoy them, and you don't want to impose by giving something more permanent. But what are you trying to maximize? Is your goal to avoid imposing on them or for them to remember you?

• For a durable impression, better to give a vase or a painting. Even if your friends don't like it that much, they'll think about you more often (though maybe not in the most positive terms).
  
• Better yet, give a gift that gets used intermittently...I like to buy people high-end headphones. They get used intermittently, so I can imagine that every time you put them on, you will think of me. Also, they're a luxury—the kind of thing that people have a hard time buying for themselves. Best of all perhaps, they're intimate: When I give someone headphones, I can think of myself whispering in their ears."