Businesses expect to pay thousands of dollars in client dinners, but balk at $50 client gifts.

As someone who's been a big believer in the power of gifting for many years now, it still perplexes me when I hear businesses balk at the idea of spending more than $50 on a gift for a client, even when that client might account for thousands, or hundreds of thousands, of dollars in revenue - current or potential.

I'll often ask these businesses the following question: "If you were to take this client to dinner, what would be the maximum amount you'd be willing to spend on the meal?"

More often than not, the person I ask say that they'd be prepared to spend hundreds or even a few thousand dollars on a nice dinner with that same client. They'll justify the discrepancy in budgets by saying that face time with a client is always the more valuable of the two.

While in-person client time is certainly hugely important, I would argue that it isn't always more impactful than sending a good, well-timed gift. And now, in the time of COVID, client dinners and events are no longer even an option, making it more important than ever for businesses to develop a good gifting strategy.

COVID aside, there are a number of reasons why good client gifts can get you even higher ROI than the usual dinner. Let's talk about 3 of them.

1. Clients get meeting burnout, but no one gets gift burnout

In my previous career, I had lots of clients at big media agencies who confided in me that they were tired of going to business dinners (and breakfasts, and lunches). Everyone wanted their business, so there was a seemingly unending string of invitations -- and they lost their appeal pretty quickly.

While I'd never suggest that gifts should always take the place of a client outing, they can be a good substitute every once in a while ... which brings us to #2:

2. When it comes to word-of-mouth, gifts work harder than dinners.

I once had a client in New York tell me she was completely fried from a week of nonstop business meals, so instead of piling on to her exhaustion with yet another lengthy dinner, I scheduled a coffee meeting with her during the workday during a trip to the city.

On the night I'd originally planned to take her to dinner, I couriered her a package containing gourmet popcorn, fancy chocolate bars and a pair of cashmere socks so she could enjoy her night in. We already had a good rapport, but this solidified what became a true client friendship. She brought up that gift every single time I saw her, and she told all of her work colleagues about it. As a result, we wound up not only growing our book of business with her, but also got new business from other departments in her organization.

People will talk about your (good) gift. But unless you saved a choking diner with the Heimlich maneuver or took them to the fanciest restaurant they'd ever seen in their life (and spent a LOT of money in the process), chances are clients won't talk about a dinner.

It's worth noting that I didn't have to do the latter to get invaluable word-of-mouth - I only spent around $150 on that gift.

3. Gifts are unexpected, meaning they're more likely to be remembered and appreciated.

Clients expect to be taken to dinner, and often, they get taken on a lot of them. Even if you wind up having an especially delicious meal with fabulous conversation, in all likelihood, it'll be forgotten as soon as they get back into the craziness of their work the next day. However, with the exception of Christmas, gifts are usually quite unexpected - meaning they'll remember it and even tell others about it (like my cashmere sock recipient). People tend to feel more grateful for things they didn't expect to receive.

Put another way: I can pretty much guarantee you you'll get a thank you call or email when you send a client gift. When was the last time you got a thank you note for taking a client to dinner?