How The Corporate Rules Grinch Stole Christmas - OZY | A Modern Media Company
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Stricter controls and smaller budgets mean reusable cups have replaced hampers and wine.

By Emma Jacobs

Christmas may be the most wonderful time of the year, but when it comes to corporate gifts, it is not the season it once was.

“I’ve been around long enough to remember the bad old, good old days,” says Crispin Rapinet, who heads Hogan Lovells’ global investigations, white collar and fraud practice. “People would send a case of wine, and you would take it home to enjoy with your families without disclosing it.”

Anti-bribery regulations and straightened corporate budgets have meant that when it comes to sending gifts to clients and suppliers at Christmas, employers advise caution. As one banking analyst puts it: “The advent of compliance, etc., really killed off Advent.” Many companies now dispatch branded, low-value goods, such as notebooks, power banks and reusable cups.

“The banking crash fundamentally changed the world economy and it hasn’t come back in the same way,” says Rapinet. That has coincided, he says, with increased awareness and scrutiny of bribery and cultural change.

I’m like the Grinch at Christmas. I won’t spend any of my budget between Thanksgiving and Christmas.

John Ruhlin, author

In the U.K., for example, the Bribery Act was introduced in 2010. Today, large employers have codes of ethics, including gift policies. In the U.S., Moira McGinty Klos, vice president of the Ethics and Compliance Initiative, says there is no universal rule, but most companies set it at $25.

Typically, employees will be required to hand in gifts over that amount, which may be donated to charity; flowers or food may be shared between teams. The guidelines drawn up by Alphabet, Google’s parent, for example, advise “generally, acceptance of inexpensive ‘token’ non-cash gifts is permissible”.

Satindar Dogra, a dispute resolution partner at Linklaters, the law firm, has seen companies exercise much greater care around events such as Wimbledon and the World Cup, and imposing modest financial thresholds beyond which line manager approval is required. “I have also seen companies impose much stricter controls around public officials — for example, no gift giving at all,” he says.

 

Nonetheless, Simon Thompson, retail and hospitality director at department store Fortnum & Mason, says business is brisk. Some corporate customers have bought Imperial hampers as gifts. They include champagne, port, Christmas pudding, beef and ham — and sell for £6,000.

Andy Ducksbury is sales director at Prominate, which orders and dispatches corporate gifts for business clients as well as promotional gifts. “Historically [we] would do high-end leather goods, particularly [for] pharma companies, Montblanc pens worth hundreds of pounds,” he says. “We haven’t seen that kind of spending [for 10 years].”

Robert Cialdini, social psychologist and author of Influence: Science and Practice, says that at his own company, Influence at Work, he tries to add “non-monetary value to our gifts by personalizing them to the recipient”.

This might be, for example, embossing the client’s name, along with the company name (much smaller type), on pens or water bottles. “The practice involves a small cost to us but a large increase in the experienced value of the gift for our clients,” he says.

Even small gifts have an effect on the recipient, says Cialdini, citing a study of a sweet shop that showed if customers received a chocolate on entry, they were more likely to buy something.

In experiments where researchers gave small gifts, such as pens or mugs, they found that they “strongly influence the recipient’s behavior in favor of the gift giver. Subjects are well aware that the gift is given to influence their behavior but reciprocate nevertheless … a gift triggers an obligation to repay the gift.”

Mick Humphries, sales director of TC Branding Group, says tastes have changed. Ten years ago, “wine and booze was very much the culture. We’re not going down that road … the corporates have to look responsible. Not just at Christmastime, people are [generally] more cautious.”

Andy Thorne, sales and marketing director of Outstanding Branding, agrees. “Once upon a time, a lot of people gave wine or wine bottle openers. The world has changed. People don’t want to be seen as encouraging [others] to drink.” This might be for health or religious reasons.

Companies are more likely to want to be seen as environmentally friendly and are cautious about sending gifts that will go straight to landfill. That said, roast turkey hats and light-up festive pens might be winging their way to corporate post rooms. One supplier tried to “punt light-up wineglasses,” notes Humphries.

Another trend is the branded Christmas jumper. The recipient is then encouraged to share a picture of themselves wearing it on social media for the chance to win a prize.

Research carried out by the British Promotional Merchandise Association discovered that 87 percent of those surveyed generally kept a promotional item for longer than a year, so it may promote continued brand awareness.

Jon Birrell, chief executive of the BPMA, says, “We do still sell mouse mats, surprisingly some buy them. … Reusable cups are massive at the moment.” The problem then becomes how to stand out from all the other reusable cups.

Personalization is John Ruhlin’s tip. The gift-giving expert and author of Giftology would even go so far as to add the names of the gift recipient’s family. His key message, however, is to save the corporate budget for some other time of the year when it is more likely to be noticed and looks less transactional.

“I’m like the Grinch at Christmas. I won’t spend any of my budget between Thanksgiving and Christmas,” he says.

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By Emma Jacobs

OZY partners with the U.K.'s Financial Times to bring you premium analysis and features. © The Financial Times Limited 2020.

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