‘Tis the season for corporate gifting, and businesses large and small are, yet again, closing the books beneath a cloud of uncertainty as they make that annual decision concerning how best to say thank you to their most important customers, vendors and employees.
The effort and expense involved in determining how much to spend and what to give can not only overshadow the spirit of the gesture, but can also become a stressful, time-consuming cost center that carries outsized risk of backfiring if mishandled.
“Corporate culture has kind of sucked the soul out of gifting. It's made it transactional. It all exists on Excels [spreadsheets] and in doing so, has made it pretty thoughtless and worthless,” Jonathan Legge, co-founder and CEO of Ireland-based global corporate gifting firm &Open told PYMNTS.
What’s worse, Legge said, is the fact that most corporate gifts end up in a landfill, a painful and poorly kept secret in an industry he says has traditionally been super wasteful.
In short, corporate gifting is broken, Legge said, and badly in need of a reboot.
“So, our manifesto, and what we’re looking to fix, is about bringing back the thought and care to corporate gifting and making it joyful again and easy for the sender and the recipient,” he said.
You Shouldn’t Have
At the core of this revamp, Legge said, is choice — as in, making it easy for businesses to make gifting decisions and the financial commitment that goes with them simple and justifiable. It’s a shift, especially for SMBs, that means enabling companies to make ad-hoc decisions rather than committing to year-ahead annual contracts.
This gifting choice and flexibility, if you will, also involves increasingly important ESG considerations so that the values of the giftor and giftee are not compromised or conflicted. In some cases, that literally includes giving a recipient the ability to say, ‘You shouldn’t have’ and have their present repurposed as a donation to a charity.
To accommodate all of this nuance and complexity that is inherent in this process while also reflecting the present economic climate, &Open has launched On-Demand, its new self-serve B2B marketplace that facilitates gifting for the holidays and beyond.
“What's been interesting with the economic headwinds you're talking about is that we’ve seen a kind of hesitancy towards overcommitting,” Legge said. As opposed to committing for a year, he said, companies are looking for ways that they can be more ad hoc in their approach.
“[Businesses are] starting to figure out what that [gifting] role might be for their business because every brand has different relationships they're looking to nurture,” he added. “A key part of why &Open’s on-demand service is coming out now is to navigate that change in thinking,” which he characterized as a desire to experiment with gifting and figure it out for themselves.
The Math
As much as gifting is idealistically supposed to be devoid of financial and other considerations, in reality it is still a business decision, and very subject to the same ROI (return on investment) metrics of any other corporate expenditure.
While the math, so to speak, or the cost-benefit analysis of gift-giving varies widely, Legge has many examples of clients whose gifts gave back, such as a 12% increase in revenue after six months of gifting, or a 200% ROI on the back of a European furniture business then sent flowers to customers who had made a purchase over a the course of a month. While results differ, Legge tends to take a more holistic view of the give-and-take aspect of the process.
“Gifting works,” he said. “It takes time to build out an ROI as we have to have long-term relationships in place, and they have to be comfortable sharing the metrics with us,” he said.
“I think everybody just gets it intuitively that gifting works,” he added, noting that by “works” he means “creates loyalty and, yes, improves the bottom line.”
