Etsy Unveils Innovative ‘Gift Mode’ Powered by AI for Personalized Shopping Experience

Etsy Unveils Innovative 'Gift Mode' Powered by AI for Personalized Shopping Experience

Etsy has taken a significant leap into the world of generative shopping with the launch of ‘Gift Mode,’ an innovative feature designed to ease the gift-giving process. Unveiled by Etsy CEO Josh Silverman in a recent announcement, Gift Mode combines artificial intelligence (AI) and human curation to assist shoppers in finding the perfect gifts for any occasion.

Gift Mode operates as an interactive hub that simplifies the gift selection process. Shoppers can input details about the recipient, such as their relationship and the occasion, and then explore curated gift options from Etsy sellers. The company’s machine learning (ML) technology, powered by OpenAI’s GPT-4, plays a key role in suggesting more than 200 potential gifts tailored to over 15 different interests and personas, including “The Music Lover,” “The Adventurer,” and “The Pet Parent.”

According to Silverman, Gift Mode addresses common challenges faced by gift-givers, such as finding a creative and personal gift when the giver has limited knowledge about the recipient. Additionally, it alleviates stress related to procrastination by offering last-minute shoppers the ability to send a gift notification with tracking information at a selected time.

Etsy’s move into generative shopping aligns with a growing trend in the retail industry. A PYMNTS Intelligence and AI-ID collaboration revealed that 92% of companies are using AI-powered personalization to drive growth, while 44% of consumers are open to using chatbots for product information.

To position itself as the go-to destination for gifting, Etsy plans to showcase Gift Mode prominently in its marketing efforts, including a Super Bowl commercial. The company aims to increase the share of shoppers who view Etsy as a gift destination from the current 12%.

Tim Holley, Etsy’s VP of Product, emphasized that Gift Mode was built to address the anxiety often associated with gift-giving. A survey conducted by the company revealed that 71% of respondents felt anxious when shopping for gifts. Holley stated, “We built Gift Mode on the insight that while plenty of brands sell items that make nice gifts, there isn’t a dedicated and scaled shopping experience that addresses these pain points while helping shoppers find truly thoughtful, meaningful gifts.”

Etsy’s commitment to enhancing the gift-giving experience includes plans to invest further in Gift Mode’s capabilities and expand its gifting space. With over six million sellers and more than 90 million customers, Etsy aims to provide a seamless and stress-free platform for discovering and purchasing gifts from independent sellers.

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