Etsy launches ‘Gift Mode,’ a new AI-powered feature that generates 200+ gift guides

Etsy launches ‘Gift Mode,’ a new AI-powered feature that generates 200+ gift guides


E-commerce site Etsy today launched “Gift Mode,” a new AI-powered feature to match you with tailored gift ideas based on specific preferences.

Gift Mode is essentially an online quiz that asks about who you’re shopping for (sibling, parent, child), the occasion (birthday, anniversary, get well), and the recipient’s interests. At launch, the feature has 15 interests to choose from, including crafting, fashion, sports, video games, pets, and more. It then generates a series of gift guides inspired by your choices, pulling options from the over 100 million items listed on the platform. The gift guides are centered around more than 200 different personas. For instance, “The Music Lover,” “The Video Gamer,” “The Adventurer” and “The Pet Parent.” Over time, the company plans to add new interests and personas in response to “emerging trends,” Tim Holley, Etsy’s VP of Product, told TechCrunch.

Additionally, Etsy introduced a “gift teaser” option where you can send the recipient a sneak peek of the item via email in case the gift won’t arrive in time for the event. You can also include a gift note and tracking information.

Online retailer UncommonGoods did something similar in 2017 when it released “Sunny,” its AI-powered gift guide feature that suggests products based on inputs like who you’re shopping for, their age group, and hobbies they’re interested in. There’s also a text box to add more specific preferences.


Image Credits: Etsy

Etsy hopes Gift Mode will relieve the stress that comes with selecting the perfect present. According to Etsy’s latest survey, 71% of respondents felt anxious when shopping for gifts within the past year.

“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 designed for the gifter that addresses these pain points while helping shoppers find truly thoughtful, meaningful gifts. Now, Etsy is building for the gifting experience year-round, to become the destination for gifting. And we believe these products will help people discover and more easily purchase gifts from independent sellers,” Holley added.

Holley explains that the new feature leverages a combination of machine learning, human curation, and OpenAI’s GPT-4.

“OpenAI’s GPT-4 enabled us to expand to such a wide range of gifting missions. We then built and scaled the product on Etsy’s existing advanced machine learning training and inference stack – which powers search, recommendations, and more on Etsy. For this use case, we included specific adjustments to make sure listings included are ‘gifty’ and add preference to listings that are predicted to be high quality and sold by sellers who offer excellent customer service,” Holley said.

AI has powered the platform’s search features for years and the company recently increased its focus in the area, particularly generative AI.

“We’ve been at the cutting edge of search technology for the past several years and while we use large language models today, we couldn’t be more excited about the potential of new or large language models and generative AI to further accelerate the transformation of Etsy’s user experience,” Etsy CEO Josh Silverman told investors during an earnings call in May 2023.

Etsy has released other gift-related offerings in the past, including wedding and baby registries. The company says it will continue its investment in the gifting space and enhance Gift Mode’s capabilities over time.

The platform recently announced a new optional program, “Share & Save,” where sellers share links to their Etsy store, and after making a sale, the platform only takes a 4% transaction fee instead of the usual 6.5%. In 2022, the company received backlash from sellers when it increased the fee to 6.5% — up from 5% — which resulted in a strike.

Etsy touts more than 90 million customers and over six million sellers.


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