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November 18, 2014

Giving gifts to clients… is it good business?

alex2My son, Alex (see photo), is a senior finance major at the University of Tennessee. After interning this past summer in the wealth management division of a large bank, he stayed on and has been working there this semester. He’s been very fortunate that one of the senior executives there has taken him under his wing and been a good mentor to him.

Alex was home this weekend and we talked about his boss/mentor. A really interesting lesson that Alex took away from him was the regular giving of gifts by his boss to his clients… and not just at the holidays, but all year round.

That got me to thinking about our industry… Is gift-giving (outside of December) a common occurrence? Should it be? Does giving gifts help to build relationships? Or guarantee a client’s on-going patronage?

Think about a typical client and a typical project… depending on what part of the industry you work in, a single project could range in fees from a few thousand dollars to tens of thousands. And a repeat client might bring in hundreds of thousands of dollars (or more) every year! Do your key contacts at those kinds of clients warrant an occasional gift as a thank you?

And what about helping your contacts celebrate or recognize events unrelated to your work together… for example, birthdays, promotions, the birth of a child, etc.?

I’m going to argue FOR giving gifts and here’s why…

  • In our increasingly technology-driven society, it’s becoming harder and harder to connect as people… and an unexpected gift can help you do that.
  • Contrary to what they say in the Godfather, sending a gift is personal… it’s not just business. It’s sent from a person to a person, not from a company to a company.
  • Our industry is also becoming increasingly competitive. Gifts are one small way to help you stand out and stay top-of-mind.
  • And ultimately… it can’t hurt! OK, not very compelling… but true.

Bottom line: If you do decide to start giving gifts to clients, remember… it’s not the cost of the gift or the uniqueness of it that really matters – it’s the simple human gesture of doing something nice for someone else. Ultimately… all things being equal, people do business with people they like. All things NOT being equal, people STILL do business with people they like.

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