Giving Gifts in Business | Corporate Gifting
Imagine that you have been doing business with a supplier for the past year. Your partnership has yielded profitable results – for both parties. A representative of your supplier comes to your office with a small bouquet and a gift to congratulate and praise you for this achievement. You are happy with the appreciation that your supplier expressed. But on the other hand, you are pondering over various thoughts – Should you accept the gift? Is it perhaps too expensive? Will your manager or organization approve of you accepting the gift? How will your supplier feel if you refuse the gift?
You have encountered a situation called "Corporate Gifting".
What is Corporate Gifting? Definition
refers to the practice of giving employees, investors, existing clients or prospects gifts of various kinds to show them that the organization is grateful for them. These gifts could be either monetary or non-monetary, like flowers, whine, a box of sweets, a gadget. The gifts act as a token of appreciation for the time and efforts an individual has put in, which has in turn benefited the gifting (giving) organization.
Gifting typically strengthens the relationship and positive associations between the giver and the receiver. However, corporate gifting may sometimes have negative connotations. Although corporate gifting is not entirely illegal, there can be restricting laws and company policies which employees have to bear in mind while giving or receiving gifts. For instance, some companies or public organizations do not allow their employees to accept gifts worth beyond a specific amount. Others demand any gift to be reported to ones' manager.
To whom are gifts given?
- EXISTING CLIENTS AND INVESTORS: Helps to secure or increase long term connections and mutual trust with them.
- PROSPECTIVE CLIENTS AND INVESTORS: Raises their interest in the organization – they may be more likely to invest in the firm or buy a product/service offered by the firm.
- EMPLOYEES: Gifting them results in higher levels of employee retention, job satisfaction and commitment. It makes them feel valued and recognized, thus fostering a sense of belongingness.
Pros of Corporate Gifting. Advantages
The main benefits of corporate gifting are as follows:
- BRAND REINFORCEMENT: Impress clients and also to represent the brand by adding the company logo to the gift.
- HELPS BUILD LASTING RELATIONS: Whether one is a client or an employee, investing in gift-giving helps strengthen one's ties with the organization. It enables open and transparent communication with the organization and clients and employees will feel they are valued and appreciated.
- MAKES ONE STAND OUT FROM COMPETITORS: Gift-giving on special occasions or while celebrating accomplishments makes the clients feel special and closely connected with the organization. It motivates them to continue their business and partnership with these organizations.
Cons of Corporate Gifting. Disadvantages
The main issues and pitfalls of corporate gifting are as follows:
What are your thoughts and experiences about corporate gifting?
- PREVENT WRONG INTERPRETATIONS: Organizations should consider the gift's monetary value before gifting the same to their clients or employees. One must identify the fine line between a gift and a bribe. An overpriced gift does not indicate goodwill or appreciation; rather, it reflects the organization's efforts to gain clients' favors through bribery.
- CONSIDER THE BUDGET: Although the organization may decide on low-priced gifts, the entire process of corporate gifting is indeed a costly affair. Also, there is a false misconception that the bigger and costlier the gift, the greater is the amount of appreciation reflected towards the organization. This is far from being true. Hence it is crucial to consider two factors: a) Organization's total expenditure for gifting people, and b) perceived value of the clients and employees being gifted.
- COMPLEXITY OF THE PROCESS: Corporate gifting requires careful planning before its actual execution. For instance, the occasion, the type of gift, or the list of people receiving the gift. It is also crucial that the gifts cater to the receiver's interests. If the gift does not align with the receiver's interests, it may make them feel uncomfortable. A poor choice of gift may overshadow the organization's good intentions.
Bregman, P. (2010, December 15). The real point of gift-giving. Harvard Business Review.
Harris, E. (n.d.). Pros and cons of professional gift giving (and gift ideas). Resultist Consulting.
Sendoso. (n.d.). What is corporate gifting and why is it important?