Corporate Gifting and Psychology Co-relations
What is Corporate Gifting and How Crucial it is to the Business World
Gift-giving customs are ubiquitous in social, political, and business life. Gifting plays an important role in strengthening interpersonal relationships and fostering social connectedness. Within the workplace, gift-giving can boost financial growth and is integral to a business's success. A corporate gift is any gift given by an organization or a company to its employees and clients. Corporate gifts can be identified as internal gifts or external gifts: Internal gifting refers to gifts are given by the employer to their employees, managers, or even stakeholders; External gifting defined as gifts are given to the clients. Corporate gifting creates a sense of connection to the employee and can create positive associations with their clients or partners. This act of giving indicated that the company values its relationship with its employees and clients and is willing to establish a long-term stable business relationship. An article from Forbes discussed the future revenue and potential growth of business corporate gifting market. New research estimates that the trends of the corporate gifting market will reach about $240 billion in 2021 and continue to grow at an accelerated percentage between then and 2024. The article conversed about an increase in budget spending on corporate gifting due to the current COVID-19 pandemic. The amount spends on each gift is also staggeringly high. Most people reported spending between USD25 to USD125, with the largest percentage reporting between USD75 to USD100. Corporate gifting is similar to personal gifting in which both require effort to carefully selected the well-chosen gifts that help benefit the company, promote deeper emotional connections between the giver and the recipient.
What is Corporate Gifting and How Crucial it is to the Business World
When it comes to gifting to employees, it creates a sense of connection and belongingness to the company and can make employees feel appropriated and their hard work is valued. Corporate gifting is also a powerful tool for connecting with employees to celebrate their success and achievements, increase retention rates, and overall satisfaction. According to Statistic Canada, opportunities to work from home have increased significantly during the COVID-19 pandemic compared to the years before the pandemic, from 4% in 2016 to 32% in 2021. Although working from home allows you to have flexible schedules, be able to custom your workplace environment and more money is saved, it reduces the social interaction with co-workers, lack of physical space for work at home, lack of team building, and team innovation. Gifts are one way to build trust and rapport with the employees but also a way to show care about their well-being. Organizing thoughtful packages for work from home employees will empower them to continue to be productive and show them that the company values their work-life balance. Hence, a customizable work from home survival kit is an example of the best employee gifts. A survival kit can include some essential items for the employee to stay on task and healthy. It can include any combination of the following essentials : stationery and desk supplies, exercise supplies, health care packages, technology accessories, or stress reduction items. These corporate gifts can be served as extrinsic motivations for job satisfaction and productivity.
Gifts for Business Partners
Corporate gifting is a great way to affirm the business relationship with your partners and let them know that their business is valued. This will not only increase your brand recognition and client retention but also transforms them into brand evangelists and an excellent source of marketing for your company. Besides, gifting to your clients can cultivate a B2B (business to business) relationship. Forming a B2B alliance has enormous benefits for both the company and business partners to sustain growth and development. In particular, when gifts are well-timed and personalized, it will increase brand awareness and keep your brand a top consideration for prospective clients. According to Forrester, a market research company has shared research that partner experiences play a crucial role in shaping customer experiences. As more than 70% of global revenue comes from third-party partners, it is becoming more apparent that partner experiences controlled a significant part of the experience with customers. There is a direct correlation between "maintaining a greater customer experience while at the same time driving an excellent partner experience". Jay McBain, a principal analyst at Forrester, suggested around 43% of global B2B marketing decision-makers are advised to prioritize improving customer experience in 2019, while approximately 40% aim to improve partner experiences. He also predicted this trend will continue to rise in the coming future. Therefore, companies need to put extra effort to please both parties to get the trusting relationship running.
Gifts for Customers
Cooperate gifts can act as a source of business promotion and investment in brand awareness. It improves brand image and maintains customer loyalty. Corporate gifts provide companies with the opportunity to connect with their customer base and can be used to retain or regain your current as well as past customers. Offering customers with appealing, catchy, and personalized gifts will create a positive perception of your company. Hence, based on the overall impression of your brand and customer experiences, customers will buy from brands they are confident, are familiar with and consistently get value from. As a result, benefits your company by increasing sales and adding value to your business growth.
The Psychology of Corporate Gifting
Emotional ConnectionGifts bring people closer together. The New Science of Customer Experience, published in The Harvard Business Review, has studied hundreds of brands and detailed the causes and effects of building an emotional connection with customers. They examined the relationship between brand recognition and emotional engagement. They found that the deeper the relationship with the brand, the more emotional connection and the higher the satisfaction they are with the brand. These highly emotionally connected customers are going to shop more and spend twice as much annually. On the other hand, customers who are not emotionally connected are not very satisfied and eventually spend less on the brand. A term called "emotional motivators" refers to the elements that align with customers' motivations.
How the word "emotion" is defined in psychology and how is it related to motivation? Emotion is a complex psychological phenomenon associated with a complex pattern of changes, including physiological arousal, feelings, cognitive processes, and behavioural reactions. Emotion is highly subjective and influences the decisions we make in day to day lives. Emotions are motivational and informational (Izard, 2009) which increases the likelihood you will take a certain action. Motivation is often accompanied by emotions, for example, positive emotions, such as happiness motivates a person to put the effort into achieving the desired outcome, whilst negative emotions, such as anger impact detrimental to motivation because they narrow one's focus. The Harvard Business Review has identified 10 common emotional motivators that can raise customer value towards the brand: Stand out
- Endowment Effect and Theory of Reciprocity An emotional bias is that the object that we owned seems to be more valuable to us (Achtypi, Ashby, Brown, Walasek, & Yechiam, 2021) . There is a famous example demonstrated by Daniel Kahneman, Jack Knetsch, and Richard Thaler in 1990: Participants were given a coffee mug with the option to exchange it for other goods of equivalent value. It showed that after the participants had the mug, the price they asked to trade it away was twice as high as the amount they were to pay to get it. The reason behind this effect can be interpreted as the feeling of ownership (Strahilevitz and Loewenstein, 1998). In short, people tend to place a higher value on the items they already own than on identical items that they don't. It makes no difference whether the product was purchased or received as a gift. The result of giving a corporate gift to customers is that they psychologically overvalue the gifts when they are endowed with it. This is when the feelings of reciprocity kick in because people value the gifts more highly and people are aware that they are owing us something back. The theory of reciprocity refers to the tendency of wanting to give something back when something is received. Sending gifts incentivizes the customers to be more likely to demand your services and take desired actions, such as signing up for membership and making purchases. Besides, these corporate gifts make the employees feel more valued by their company and allow them the experience a sense of belongingness and connection to the team. As such, these emotions affect how employee approach their jobs and the level of service they provide.
Corporate gifting reinforces your brand by strengthening the connection between partners and employees. It is worth noting that emotional motivators for a specific brand differ depending on where a person is in the customer journey. Those motivators are difficult to pin down since brands connect to their customers at different levels, and each may have a varied starting point when trying to establish emotional connections based on various customer segments. Therefore, corporate giving is the most successful strategy to express appreciation and to build an authentic emotional relationship with your clients, workers, and business partners. According to Instapage , approximately 80% of customers think they are more inclined to do business with a brand that provides personalized service. If you are sending well-timed and personalized corporate gifts to new customers, they can serve as significant emotional motivators for future profitable behaviours.