The most valuable strategy in building customer relationships nowadays is the introduction of a holiday gifting program. Such activities do not only strengthen the bond with the clients but also improve the motivation of the employees. But how do you measure the success of your gift giving program? Even though a gift’s effectiveness can be hard to assess when sent manually, there are reporting tools that come with a corporate gifting platform which can be used to assess how target specific objectives have been met.
What is a Holiday Gifting Program?
When developing a holiday gifting program, it’s crucial to align it with your organization’s framework using tools such as CRM platforms to synchronize gift-giving with sales cycles for effectiveness. Equally important is balancing a diverse range of gifts while respecting cultural limitations, enabling recipients to choose gifts that genuinely resonate with them.
Clearly defined rules for selecting, budgeting, and distributing gifts are essential, setting a standard procedure while allowing for exceptions that may arise. Integration with your organization’s marketing and sales strategies is key to achieving sustainable outcomes through the program. Without proper alignment, gift-giving may falter in bolstering cooperation, underscoring its role in customer retention strategies.
Utilizing gifting platforms like Giftsenda, along with the reporting features, can significantly aid in tracking the number and impact of gifts dispatched. This data is fundamental in assessing the effectiveness of your program. Such insights pave the way for refinement and future enhancement of the gifting initiative.
Lastly, adherence to corporate compliance and legal standards is paramount in maintaining ethical integrity and avoiding legal complications.
How to Measure the Success of Your Holiday Gifting Program
In order to evaluate the efficacy of your holiday gifting program, different metrics can be deployed. These include, but are not limited to, client retention rates, the feedback generated from gift recipients, and the overall sales before the onset of gifting sessions and after. Surveys can also be particularly useful as they can help in gathering responses and evaluating the satisfaction of the recipients against the value of the gifts presented to them.
Cost Per Acquisition
Cost per Acquisition (CPA) is the metric which determines the cost incurred in acquiring a new customer and is common when examining the cost effectiveness of a gifting focused direct mail campaign.
To derive the CPA for your gifting campaign, initially evaluate the total cost used on the campaign and then evaluate the new customers it yielded. For instance, if the campaign cost $3,000 and 20 customers were acquired, the CPA would be $150.
Let us put ourselves in a different example: if your campaign cost $8,000 and generated 50 customers. The cost per acquisition would be obtained by dividing the overall cost of that marketing campaign by the number of customers acquired which in this case is $160. It is a measure that determines the efficacy of the campaign and whether there are expected returns for the particular expenditure of direct mail.
Redemption Rate
Redemption rates measure how many individuals are claiming the gifts sent in your corporate gifting campaigns, providing insights into campaign success and aiding in future planning.
A low redemption rate in an e-gift campaign might suggest mismatches between the gift type and the target persona, possibly indicating that a tangible gift could be more effective. Conversely, high redemption rates may signify increased engagement with your campaign. However, it’s vital to prioritize messaging over the gift itself. The primary campaign objectives should be fostering relationships and initiating meaningful dialogues with prospects and customers, not merely driving sales or upsells.
To determine the redemption rate, divide the number of redeemed gifts by the total offered and multiply by 100 for the percentage.
Return on Investment (ROI)
Measuring the Return on Investment (ROI) for your direct mail campaign is crucial for assessing its overall effectiveness and the impact of gifting on your business’s financial performance.
To calculate the ROI, first determine the net gain from the campaign by subtracting the total campaign cost from the revenue it generated. Then, divide this net gain by the total cost of the campaign. Multiply the resulting figure by 100 to convert it into a percentage.
For example, if your campaign generated $25,000 in revenue and incurred $10,000 in expenses, your net gain would be $15,000. Dividing $15,000 by the campaign cost of $10,000 gives 1.5. Multiplying by 100, you achieve an ROI of 150% – excellent work!
Reachdesk has noted that direct mail typically delivers an average ROI of 112%, which is outstanding compared to other marketing mediums like SMS (102%), email (93%), and paid search (88%). In fact, some Reachdesk clients have seen ROI as high as 384%.
Close Rate
Close rates are vital in understanding the proportion of prospects that have converted to customers within the sales pipeline. This metric is particularly useful for sales and marketing teams assessing the impact of gifting strategies on driving conversions.
To calculate the close rate for a campaign, divide the total number of customers gained by the total number of prospects targeted, and then multiply by 100 to get a percentage. For instance, if a gifting campaign led to 75 new customers from a pool of 300 prospects, the close rate would be 25%.
In another example, if you converted 50 customers from 200 prospects as a result of your gifting efforts, your close rate would be 25%. These examples help illustrate the effectiveness of the campaign in nurturing prospects along the sales pipeline toward becoming customers.
Cost Per Conversion
The cost per conversion metric is a crucial indicator of the efficiency with which gifting turns prospects into customers and reflects the performance of your direct mail campaigns.
If this cost is high, it might signal that your direct mail efforts require fine-tuning—potentially due to your Business Development Representatives (BDRs) not effectively targeting the right prospects, or because there are inefficiencies in your B2B sales process. On the other hand, a low cost per conversion suggests that your BDRs are effectively converting prospects into customers.
To calculate the cost per conversion, you take the total cost dedicated to gifting and outreach and divide it by the number of prospects who became customers through these efforts. For example, if you spent $5,000 on gifts and successfully converted 25 new customers, your cost per conversion would be $200. In another scenario, if a campaign involved expenditures of $12,000 on gifts and resulted in 100 conversions, the cost per conversion would fall to $120. This figure helps gauge the economic value of each customer acquired through your gifting campaign.
Sentiment Analysis
Sentiment Analysis is a powerful tool in evaluating the effectiveness of your Holiday Gifting Program. You can use the feedback provided by gift recipients on the campaign report in Giftsenda to gather your data.
Response Rate
Response rate, a key direct mail performance metric, measures the number of recipients who engage with your campaign. For sales and marketing teams, this could be prospects requesting more information after receiving a gift-accompanied email. This metric provides insight into prospect interest and the effectiveness of direct mail as an engagement tool.
Factors influencing response rates include industry type, target audience seniority, gift budget, initial email quality, and gift personalization. To calculate, divide the number of responses by the total gifts sent. For example, 150 responses from 1000 sent gifts yields a 15% response rate.
Using specialized tools like Giftsenda can potentially boost response rates, enhancing the overall effectiveness of your gifting strategy.
Cost Per Send
Calculating the average cost per gift sent is an essential metric for monitoring campaign expenditure and assessing the cost-effectiveness of your direct mail and corporate gifting initiatives.
To determine the average cost per send, simply divide the total cost of gifts by the number of sends in your campaign. For instance, if your campaign’s total gift expenditure is $8000 and you distributed 500 gifts, your cost per send would be $16.
Frequently Asked Questions about Holiday Gifting Programs
Q: From when should we start working on our Holiday Gifting Program?
A: For any holiday program, it’s advisable to begin the process at least three months beforehand. For example, if your holiday focus is December, for example, you should make your preparatory arrangements by September. This would give the number of time needed for strategizing, choosing gifts as well as planning for logistics.
Q: How often should we send gifts in our Holiday Gifting Program?
A: The rate or frequency depending on the nature of the relations in the company and its clients. Nevertheless, for any company, for the most part, one gift a year among the festive ones is sufficient. For example, sending a hamper or a single present of your choice then during December only is a strategy that can be used.
Q: Is it permissible to send gifts many times in a year?
A: As many opt for a once a year option, there are those who choose to do multiple gifts in a year. For example, you may choose to send a small gift on Thanksgiving holiday, a big one on the December holidays and an additional one on New Year’s. This works for companies that have close interaction with clients.
Q: Should we mind the cultural peculiarities while coming up with our gifting time frame?
A: Definitely. If your clients come from different backgrounds, you might as well change your gifting schedule as well. For instance, you would send gifts in honor of Diwali for your Indian clients around this time in October/November, you will have Hanukkah gifts for your Jewish clients in December and Lunar New Year gifts for the Chinese clientele in January/February.
Q: Is there any way that our Holiday Gifting Program can be made a part of the overall customer engagement strategy we have?
A: Yes, this is a very wise thing and should be done quite often. For example, rather than focusing on only one point of interaction, you could instead look for other such opportunities throughout the year and align them with your gifting. For example, in July, you might send a small gift to acknowledge the mid-year point, follow this by a larger holiday gift in December, and then in January, forward a thank-you note or a small token, to usher in the new year.
Let Giftsenda help you measure your gifting!
Giftsenda is an innovative platform designed to streamline corporate gifting, making it easier and more efficient for businesses to manage and execute their gifting strategies globally. With a vast array of options, Giftsenda offers curated gifts that cater to a diverse set of preferences and occasions, ensuring your company can make a meaningful impact with high-quality, thoughtful presents. For assistance in setting up a successful holiday gifting program, our experts are here to help.
