When you think of gifting, your mind might immediately think of the Big C — Christmas. While that’s the holiday hogging the gift-giving spotlight, focusing on just one holiday in the fourth quarter of the year means you may be missing the big (and we mean big picture).
Set aside your notions that gifting is only about wrapped boxes under the tree. Instead, unbox the idea that gifts are, well, everywhere. Gifting in the workplace, the way we gift, and the reasons for gifting have all evolved, and ecommerce has some catching up to do.
The online gifting industry has changed, and 2022 was a landmark year that reflected how shoppers are gifting, why they’re gifting, and when they’re gifting.
We want to unwrap the reasons for these changes and make some hefty online gifting predictions for 2023.
The Pandemic Changed Us (and Our Shopping Habits) for Good
It’s no secret that ecommerce has been gobbling up a bigger piece of the retail pie year after year. Online shopping was enjoying a steady climb to the top until the coronavirus pandemic hit the US in early 2020, forcing the industry’s growth from a steady trot to a full-out sprint.
We know this growth has been a common refrain for a couple years, but in case you need a refresher, ecommerce sales increased by $244.2 billion, or 43%, in 2020. Pick your jaw up off the floor, because that’s not all.
Despite many skeptics and industry experts predicting that ecommerce sales could dip dramatically when in-store shopping resumed, ecommerce is still chugging along. Online sales posted an impressive 10.8% growth in the third quarter of 2022 — an unexpected feat for sure.
This growth is especially impressive when you consider that 2022 was fraught with signs of an impending doomsday recession and LinkedIn feeds were stuffed with layoffs, business closures, rescinded job offers, and hiring freezes. In a nutshell, “job security” would be the last term used to describe the past year. Yet ecommerce marches on.
Why?
Everyday essentials can be bought from the corner bodega any day of the week, so why are more than 20% of purchases still happening on the internet? Although this word makes many of us cringe, the answer is that ecommerce pivoted.
Ecommerce Moved Fast and Broke Things…Mostly
With stay-at-home orders taking in-store shopping off the table, nearly 12 million people checked out online for the first time in 2020. This influx of cyber shoppers meant online retailers had to iron out any wrinkles in the customer experience quickly or risk getting obliterated by the pressure (and their competition).
The industry saw increased adoption of BNPL (Buy Now, Pay Later) tools like Klarna or Affirm. Friction during the checkout process was all but erased with express and one-click payments. Curbside pickup and BOPIS (Buy Online, Pickup In Store) helped bridge the online and physical retail worlds all while maintaining public health.
Ecommerce verticals like food and beverage, health and fitness, and home furnishings were in high demand and stayed there. (Although nothing came close to the 670% spike in demand that disposable gloves saw.)
Amidst all this change in how Americans shopped online, another retail success surprise was rearing its head: gifting.
The Pandemic, Gifting, and What’s in Store
Similar to how quarantining, isolating, and keeping six feet of distance pushed US shoppers toward fully embracing ecommerce, it also pushed them to get resourceful when it came to closing the distance between friends and fam.
Gifting suddenly took on a deeper meaning as the pandemic tightened its grip. Birthdays, weddings, anniversaries, graduations—all occasions where people gather and gift were put on hold indefinitely. Instead of heading to the mall to pick out the perfect present, shoppers turned to the expansive world of direct-to-consumer brands to fulfill their gifting needs.
On top of needing to find a new way to gift in a long-distance world, gifts suddenly needed to mean more. The full mental and emotional toll of the pandemic is nearly impossible to synthesize, but there is one thing that is universally understood.
Since 2020, gifts have had a greater impact in soothing our souls, letting us know someone cares about us, and reassuring us that we aren’t alone.
“The pandemic has created a lot of anxiety. We’re reminded the world is not permanent. By giving gifts and things that are enduring and are a lasting expression of care, it helps us soothe a bit of that anxiety.” Chris Gray, a clinical psychologist turned CEO and founder of The Buycologist, gave Forbes the scoop about the changes in gifting spurred by the pandemic.
Sending friends, family, coworkers, and neighbors gifts for new reasons has smashed its inherent seasonality. Giving and receiving has been rendered a year-round gesture that closes physical distances as well as helps literally everyone feel good in the process.
The sustained growth of online shopping, the continued use of ecommerce innovations like BNPL and BOPIS, and the growth of gifting as an ecommerce category has turned one hunch into fact: Online gifting is here to stay.
How is the gifting industry making waves? How is the typical ecommerce tech stack evolving to include new gifting trends? Is an ecommerce gifting strategy now a must-have for brands that want a true omnichannel strategy? Here’s what we have to say about all that in these gifting trends we foresee for 2023.
Four Ecommerce Gifting Predictions for the Year Ahead
Prediction #1: Gifting will go social.
Already wildly popular in China, social commerce is finally making waves in the US. Also known as social shopping, this trend is “where consumers explore products and complete transactions through social media and content creation platforms.” In 2022, people around the world spent an average of 147 minutes scrolling social media every darn day, so blending the worlds of ecommerce and social only makes sense.
Social media has an engaged audience, and placing seamless shopping opportunities amidst Insta Reels and branded lifestyle content and trends is an easy way to gain clicks and conversions.
In 2021, social commerce accounted for $37 billion worth of goods sold. That number is poised to hit roughly $80 billion by 2025, hinting that consumers are going to buy based on a blend of convenience and the experience brands offer on their favorite social channels.
Our Gift Prediction 🔮
Gifting is a natural fit for social commerce. As brands invest more in making their products easy to purchase directly from a social post, we predict the same will follow for gifting. The pandemic has more people buying non-essentials online than ever, and it put everyone in a gifting spirit that has no end.
Gifting as part of social commerce makes two main ecommerce gifting opportunities frictionless:
- People will be able to easily share their favorite brands or products in the click of a button.
- Shoppers can impulsively give a product they’re seeing in their numerous social feeds or ads.
Gifting as a call to action caters to recent ecommerce trends, and it’s a CTA that could convert better in many contexts. Customized content that showcases products as birthday gifts, holiday gifts, graduation gifts, and beyond could all see higher conversions with a “Gift now” button versus the standard “Shop now.”
Plus, sending and receiving gifts fits social media content creators like a glove. Gifting is an experience with endless potential when it comes to social commerce, so we’re foreseeing a tighter relationship between the two in the year ahead.
Prediction #2: No more swag as corporate gifts.
Corporate gifting is synonymous with chintzy office supplies, swag branded with comically large logos, and other purely undesirable (or plain unusable) odds and sods. It’s being realized that gifts like branded paperweights simply aren’t appreciated by employees, and those buying the gifts are finally saying they’d like to see more innovation in the marketplace.
You might think it’s a stagnant and stuffy industry, but corporate gifting is actually one of the fastest growing ecommerce verticals today. US corporate gifting jumped from $217 billion in 2019 to an estimated $242 billion in 2021 and is set to grow 8% YoY as far as the eye can see.
Corporate gifters want to put dry, dusty corporate gifts in the storage closet. They’re seeking out products that help employees, partners, and prospects feel more seen and appreciated (and less like an afterthought). This need for more meaningful gifts has never been more evident as the pandemic still lingers, remote work is the new standard, and the Great Resignation is still underway.
Employers are scrounging for ways to connect with workers in this new landscape, and corporate gifting is playing a big role in that effort. More than 60% of corporate gifters report increasing both frequency and spend on gifting during the pandemic, and more DTC brands are trying to step up and meet this new gifting need.
Our Gift Prediction 🔮
There is a massive opportunity on the table for direct-to-consumer brands and corporate gifting. Corporate gifters are hungry for products that are meaningful, memorable, and foster relationships. Direct-to-consumer brands can rise to the occasion—if they can adapt their existing gifting infrastructure.
The majority of DTC brands don’t have a gifting solution in place. If they do, gifting is often restricted to gift cards, which are tough to track and create liabilities. While digital gift cards from a great brand are a step up from the swag of yore, they’re still impersonal and forgettable.
In the US alone, more than $15 billion worth of gift cards go unspent. Instead of being appreciated, they get lost in the inbox or tossed in the junk drawer. If a brand does try to cater to corporate gifters, the experience isn’t optimized or easy for anyone involved.
As far as people wanting to express care and provide enduring mementos, it would lead me to conclude that gift cards will decline, since gift cards are usually a gift of convenience over thoughtfulness.
— Chris Gray, Psy.D. of Buycology, for Forbes
While more brands, like Harry & David and Sugarwish, have been trying to innovate the space in terms of offerings, this doesn’t democratize corporate gifting and make it a solution that any DTC brand can own.
We predict that DTC brands will be looking to add a corporate gifting solution directly to their site so that it can be a branded customer experience that grows their direct gifting channel. With an on-site gifting solution, DTC brands are now entering the massive corporate gifting arena and tapping into a true chance to scale with this channel.
Prediction #3: Move over Christmas; gifting is good all year long.
The pandemic increased personal, one-to-one gifting.
Shifts in the workforce have increased corporate, one-to-many gifting.
All trends point to the fact that gifting is no longer a trend stuck in Q4 (and we’re here for it). Black Friday and Cyber Monday will always do heavy lifting, but with this new information, it’s time for ecommerce brands to tap into year-round gifting.
On top of rethinking gifting’s seasonality, it’s also time to rethink what makes a gift. Chocolates, flowers, and fruit baskets have historically made up the foundation of gifts that are easy to buy and send online. DTC brands need to consider the new products and platforms that are in the gifting space and leverage them to grow their gifting channel.
Our Gift Prediction 🔮
Gifting happens all year long and brands are going to play into this newfound fact. Zest is one gifting platform leading the way by giving DTC brands the gifting solution they need to grow this channel.
With Zest, brands remove friction from gifting. Merchants can easily add or remove products from their gift catalog, add in customized gift card designs, and offer shoppers a simple way to send a gift in just seconds (no addresses needed). It’s the convenience and experience all gifters are looking for. Using a platform like Zest puts the spotlight on gifting.
With an optimized and intentional way to send a gift, shoppers finally have the ability to send gifts for any reason (or no reason at all) to one or many people. Beyond Christmas, brands become gifting destinations for events like:
- A woman sending gifts to all her friends for Galentine’s Day.
- Cheering up a friend who just heard some bad news.
- Thanking a few family members who opened up their home to couch-surfing.
- Sending the squad of groomsmen a thoughtful token of gratitude.
Today’s shoppers are ready to gift, and the brands that make it easy are going to reap the advantages in 2023.
Prediction #4: Gifting is the next great ecommerce channel.
Ecommerce platforms, website usability, product photography, payment platforms, post-purchase marketing; every part of ecommerce has kept up with changing consumer behavior. Tools, apps, and platforms have been developed and optimized to help merchants and marketers grow their online business and sell more stuff.
Except for gifting.
Gifting has gone relatively untouched since ecommerce first fired up. Most times, gifters are left to handle all the logistics on their own, and corporate gifters have to plan early if they want to make it through endless phone calls or forms to place even modest gift orders.
The experience is fraught with friction for personal and group gifting, but we think that’s changing. The year 2023 is going to be stuffed with gifting innovation to make it a better customer experience for shoppers and a fruitful channel for brands.
When a brand invests in a gifting solution to help them grow their direct gifting business, good things happen:
- Increased customer acquisition through engaging with gift recipients.
- Increased customer loyalty through repeat gifters and a better CX.
- Better insight and understanding of gifting and their bottom line.
- Increased branded touchpoints in their owned gifting experience.
- A unique value that helps compete with and win over competing brands.
- An alternative to expensive ads for driving brand awareness and sales.
Our Gift Prediction 🔮
Consumers are champing at the bit to buy and send more gifts, more often. Brands that invest in their gifting solution in 2023 will be the ones to stand out and establish their storefronts as gifting destinations.
This not only means more shoppers going to direct to a brand to buy one or many gifts, but it also means more gift recipients turning into hot leads. At Zest, we’ve found that more than 80% of gift recipients are new to a brand they’re gifted. And once they receive that brand, try the product, and enter their marketing funnel, they’re set to become that brand’s next best customer themselves.
Gifting has expanded in both seasonality and product, and with the right tech stack, DTC brands will unlock this channel to its fullest in 2023.
2023 Is the Year of the Gift
We may be biased, but 2023 is set to be an especially exciting year for ecommerce, thanks in part to the gifting frontier.
Brands are going to get innovative with their messaging, new social content will be created, and the entire category will be redefined. We’re all ready to think outside the gift card and say goodbye to corporate swag. Let’s ring in the new year with gifting experiences that align with what we actually want to give (and receive), when we want to give, and how we want to give.
