Giving customers Christmas gifts: the Pros & Cons

November is over and we are now in countdown mode to Christmas. There is lots to think about: family, presents, the tree and of course plenty of food. But if you’re a small business owner, this ‘jolly season’ provides an interesting opportunity to give your loyal customers some gifts to show your gratitude for the year that has gone. Sounds like a no brainer right? Not quite. Giving away free gifts is something that needs careful consideration. Getting the balance right between quality and quantity can be tricky and there are many factors that can make this ‘give away’ process quite time consuming.

The art of giving away free gifts for customers has its perks no doubt, but it also has its down points as well. So what exactly are the pros (+) and cons (-) of giving customers free gifts...

+ Good for your brand

If you have generous customers, who provide you with recurring business, imagine their reaction when you tell them that you are going to give them a gift - just to say thank you. They feel so appreciated and valued that they tell their friends. Not only do they tell their friends, they tell their friends on social media. Suddenly you are getting free advertising, all because you decided to be nice. Ironically, this reward for existing customers is getting you traction with another audience. Of course this doesn’t always work out this seamlessly. But there is no doubt that offering the right gifts or promotions can only make you look good.

- It's a lot of work

If you are looking to become the St. Nick for your customers then you need to be giving out gifts that people actually want. And unlike everyone’s favourite bearded friend, you won’t have a big sack of toys and gifts to give out ‘willy nilly.’ This means you have to really do your homework.

For example, what product or service would you be willing to either give away or give discount on? Or are you going to give your customer something like a bottle of wine or some chocolates? And that’s not all: because you really need to gain a good understanding of exactly who your gift is targeted at. There is no point in giving something away if the recipient won’t benefit or care at all about what you’re offering.

+ The opportunity to be charitable

The Christmas season is not just about receiving gifts, it's also a time to think about those who are less fortunate. This is why it has become popular to donate to a charity in the name of your client. This is a really lovely gesture. It takes the idea of simply rewarding a client and demonstrates that you care about the wider community. According to Smallbusiness.co.uk,you will get even more ‘brownie points’ by aiding a cause “that is significant to them (the customer) and you could impress a few people with your generosity and thoughtfulness at Christmas”. Don’t underestimate the value of being charitable. Not only does it show that you're a nice person, it also shows your customers that you care about causes and not just your margins.

+/- It can be off brand or it can be effective

Just as giving out gifts can be potentially good for your brand it could also backfire if not executed correctly. Let's say your business specialises in something quite high end. You then decide to give certain customers something which doesn’t match up with your offering (a keyring for example). This may simply confuse your audience. You might even be accused of being cheap. The last thing you want to look like is the modern day version of Ebeneezer Scrooge.

Be generous to the people who are giving you recurring business. Show them that they mean something to you and most importantly, offer a gift which demonstrates that you know what they like. That might mean going through their order history for ideas. Why not then surprise the customer by offering something which is similar to what they have bought? If you are testing a new product, why not give it to them for free as a gesture. This will demonstrate that you value not just their business but their view on what you are doing.

Whatever you're planning to do this holiday season we wish all of our customers and all their friends and family a truly Merry Christmas and a Happy New Year.