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The Perils of Wrapping Paper: A Story of Consumer Expectation

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HOLIDAY PACKAGE
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It happens: a frantic last day of work before departing for the holiday. The time for making or purchasing gifts has come and gone. You find yourself, half-defeated, scanning the souvenir wire-racks of an airport or gas station. You hold out hope: somewhere, surely, there must be a meaningful piece of kitsch.

This is the unavoidable trajectory of much gift shopping, and so here's a piece of advice for the last-minute shopper: if the gift you're about to give is less than ideal, then leave it unwrapped. You may just spread more cheer this season.

Intuitively, it may seem that receiving an unwanted gift with attractive wrapping would be preferable to receiving the same gift unwrapped: at least pretty wrapping provides something positive about the exchange of, say, a fruitcake, or a pair of argyle socks; you might call it the asset of aesthetics, a small pleasure before the sight (and sigh) of disappointment. But some of my research at the Yale Center for Customer Insights, conducted with my colleague Ravi Dhar at the Yale School of Management, suggests this belief about the benefits of gift wrapping could be misguided. People think nice wrapping can never hurt -- and they're wrong! When it comes to the exchange of gifts, nice wrapping sets high expectations, amplifying the disappointment of receiving unusual or undesirable gifts, and even dimming the glow of great gifts.

This research, of course, has implications immediately relevant to gift giving. Most obviously, if you think you might be giving a disappointing gift, then don't wrap it. Of course most gifts are chosen with the high hopes that they are exactly what the recipient wants. But even for good gifts, my research shows that spending a lot of time or money on great wrapping may not make the recipient either happier with the gift or more thankful to the gift giver. Rather, mediocre wrapping can enhance the joy of receiving that great gift because the wrapping did not build up expectations.

There are also practical implications that apply not to gift giving, but to gift receiving: when receiving a nicely wrapped gift, take a moment to ask yourself -- I recommend in silence -- whether or not you are anticipating a higher-quality gift just because of the trimmings. We found across a number of trials that the simple act of asking this question helps gift recipients realize that expectations matter. A moment's pause and consideration could help you avoid setting yourself up for disappointment.

This research carries weighty implications well beyond the realm of gift exchange.
The fact that providing a high-quality initial experience results in higher expectations for what follows, as well as a greater likelihood of disappointment if the second experience doesn't match these heightened expectations, should give pause to marketers at organizations that work directly with their customers. Though an enticing mark of differentiation, adding playful or attractive extras at the outset of a customer interaction could prove detrimental. For example, sprucing up the hotel lobby makes guests anticipate nicer rooms; a friendly store greeter means that a shopper will expect a smoother check-out process; and a free glass of champagne offered to diners before their meal may mean that they judge their entrées with more exacting standards.

This is not a call for severe, Victorian austerity, for a palette of grays and browns. But be wary of raising expectations that you can't fulfill. Offering your friends a thoughtfully wrapped gift, or your customers a delightful add-on to their experience is a great strategy -- but only if you can follow through with an equivalently delightful gift or experience.