Why You Shouldn’t Give Closing Gifts
In the world of real estate, closing gifts are a common way for agents to not only show appreciation towards their clients, but to also leave a lasting impression.
Although client gifts are a widely accepted practice for relationship building, some realtors are adamantly opposed to closing gifts, viewing them as an unnecessary expense and use of their time.
Because realtors regularly hear these arguments against closing gifts by very vocal opponents, it’s easy for them to start to feel discouraged in their efforts.
However, so much of what realtors believe to be true about closing gifts really are just common myths!
Let’s debunk the most common of these myths about closing gifts.
Myth #1: No other professionals give gifts, so why should I?
Realtors who choose not to give closing gifts often defend their stance by saying that no other reputable professionals, such as doctors or hair stylists, give gifts to clients, which means that doing so could reduce the professionalism of the real estate industry. Furthermore, many professional realtors feel that their level of expertise and excellent customer service should be enough and that adding a closing gift is, therefore, simply unnecessary.
Is this perception really true?
In 2017 the corporate gifting market was valued at $22 billion—debunking the myth that other professionals don’t give business gifts. Although your doctor may not give you a gift at your annual checkup, your regular office visit probably doesn’t cost you hundreds of thousands of dollars.
From contract signing and deal closings to holidays and milestone occasions, companies with prized relationships, where the cost of customer acquisition is high, give client gifts as part of their overall strategy to cultivate meaningful long-term relationships.
Savvy real estate agents aren’t just aware of this, but they work hard to make sure their closing gifts maximize this relationship.
Myth #2: Giving a good gift is outrageously expensive.
Bigger is always better!
Or, so we’ve been conditioned to believe. Some realtors are under the false impression that, in order for their gifts to be remembered, they need to be outrageously expensive, like a ticket for a lavish cruise vacation.
Are less expensive gifts less memorable?
Client gifts don’t have to be expensive to be memorable, but they do need to be personal, useful, lasting, and ideally experiential. Taking note of what your clients like and need during the entire process will help guide you to find a great closing gift, one that makes them think of you every time they use it.
It doesn’t take too much effort to personalize a gift.
If your client loves to cook or travel, give them a unique spice specific to their favorite region. Spices are long lasting, useful and, thanks to the power of the olfactory system, the sense of taste and smell can create a memorable connection to a time or place.
Plus, spices have the added benefit of being used when your clients are entertaining friends and family, offering a seamless opportunity for you and your great service to be mentioned in the natural course of conversation.
But, remember, every gift, no matter how small, needs to be packaged and presented with care. Just like a house is instantly judged on its curb appeal, so will your gift! And the unboxing is all part of creating a memorable experience.
Myth #3: There are no financial benefits to giving gifts.
Because realtors can only deduct $25.00 worth of gifts on their taxes, many end up feeling that there is no financial benefit to actually giving closing gifts.
Is it true?
If you are giving a gift solely for tax purposes, yes, you will be disappointed, especially if the gift is for an individual versus a group (as there are even fewer tax incentives).
However, professionals who realize that their thoughtful gifts have a profound impact on client relationships will quickly realize that the money saved on taxes is nothing compared to the money earned through new business.
So, should you give your clients closing gifts?
While the choice is always yours, giving a gift, especially one that is personal rather than extravagant, is a great way to set you apart from the competition, making you memorable when it comes time for past clients to refer friends and family.
Not comfortable with closing gifts? Give an anniversary of closing gift or simply write a heartfelt thank you letter.9