Wisp is a ghost that you can sometimes find on your island at night. Find Wisp's spirit pieces to get a free item.
When to Find Wisp
Wisp can appear on your island after 8PM, even if Celeste is also on your island. Explore your island at night for a chance to find Wisp. As of the 2.0 update, he can appear anywhere on your island.
Find Wisp's Spirit Pieces
Wisp will split apart into five spirit pieces. Go around your island and use your bug net to catch the five spirit pieces. When you have all five, go back and talk to Wisp.
Get a Free Item
When you have all five spirit pieces in your pockets, talk to Wisp to get a free item. Wisp will choose a random type of item to give you, such as furniture, wallpaper, flooring, and clothing. He will give you the option to get a new item from his chosen category (something you don't have in your catalog yet) or an expensive item from his chosen category. The choice is yours!