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TCMPiCorporate gifting in a struggling economy: What companies can – and cannot – afford.


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Companies that embrace the axiom that their gift recipients shouldn’t “look a gift horse in the mouth” haven’t been keeping up with trends in the art of corporate gift giving. The simple fact is most people (and this goes for clients and employees alike) would rather receive no gift at all than some same-old, same-old promotional item that they’re just going to throw in a drawer or the trash bin.

So it’s just plain good business sense for corporate givers to stretch their dollars and their imaginations and come up with gifts that foster an emotional connection between them and their recipients.

The question is: “What’s the budget and how can companies spend it wisely rather than waste it?”

The changing way companies think about corporate gifts

According to a survey by the American Express Open Small Business Holiday Monitor, just under half of all small business managers intended to send holiday gifts to their clients in 2010. Surprisingly, considering the economy, they projected that the cost of these gifts would increase by over 50%.

Why, in this time of financial instability, would companies decide to spend more on corporate gifts? Because the economic crisis has taught us a lot about the value of our customers and how they perceive our relationships with them.

So called “gifts” that either promote the giver or are inappropriate are perceived neutrally or negatively, often causing a decline in the company-to-company relationship.

On the other hand, gifts (in all price ranges) that are perceived as thoughtful, innovative or carry a well-known brand name create positive feelings and enhance relationships. Interestingly, these positive feelings are long lasting and are often re-enhanced long after the gift giving occasion is past.

Companies cannot afford to throw money away

Where once the company calendar/hat/mug was the one-for-all gift of choice, today we know that such gifts are perceived as a token at best and blatant self-promotion at worst. As such, they are viewed as worthless by the recipient and convey the feeling that they, too, are of little value to the giver.

Promotional items are just that – promotions. They have a place in the overall marketing of a company; just not on the gift list. As corporate gifts, the dollars spent on such “gifts” may as well have been thrown away.

Companies can afford better gifts than they think

By far the most notable trend in how corporations choose their gifts is the move to brand name products and the show of originality in selecting the gifts. While the impact of such gifts is considerably stronger than non-branded gifts, they are often price competitive with lesser items. The secret in staying within the budget is three-fold:

  1. The budget is realistic. Companies can no longer consider only the financial ROI in corporate gift giving. They must consider the emotional ROI as well. In other words, companies who balance dollars against good will are more likely to select better known/better quality gifts and budget appropriately.
  2. The gift list is realistic. Many companies get caught up in the dilemma of “if we give this to that person, we must give it to everyone.” Often the result is selecting a gift that is budget conscious rather than impact conscious. Inevitably the gift has a lower perceived value. The more realistic approach is to “tier” gift giving. The company that unblinkingly edits its gift list into several levels is more likely to give appropriate gifts at each level.
  3. The gift is cost-appropriate. No one would suggest that a company overspend on gifts. The trick is to figure out what the appropriate amount to spend actually is. Then, find a name brand gift that fits the situation and the allocated budget – or negotiate a higher priced item to an acceptable amount.


According to the American Express survey “The uptick in spend points toward managers believing that it’s never been more important to give customer gifts and to make sure it’s done well… sending a strong message that you know them and you put effort into thinking about them.”

Most companies do not have the resources or experience to fully explore the wide array of gift possibilities on their own. Partnering with a trusted supplier and wholesaler can open the door to better gift choices with better ROI – both financial and emotional.

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