The problem with gift cards for business - and what to use instead

Business gifting. We’re not hating, but does anyone really think a box of Milk Tray still cuts it? Whether you’re trying to say “hey employees, I see you” or wow clients, most organisations have realised they have to do a little better than that. 

Because gifts matter. They’re linked to higher motivation, and better performance. They’re also a tried-and-tested tactic for nurturing leads and engaging clients - surprise and delight, anyone?   

That’s not to say it’s a matter of splashing the cash. Gifts or gift vouchers don’t need to be expensive, they just need to be thoughtful. Because in an AI-encroached world, that human touch feels really good (in a totally HR-appropriate way, of course).

But though gift-led recognition is important, it isn’t always easy…

How gift-led recognition can go wrong

Maybe you lead a team of bright-eyed, utterly recognition-worthy employees. 

Perhaps you’re the sales lead, trying to get those big prospects to actually get back to you. 

Or you’re the many-hatted hero so lovingly referred to as ‘the HR person’. 

Either way, you’re looking for gifts or business gift cards that will send the right message: that you understand them and their needs, and you appreciate their time. But there are a lot of blockers to getting that right:

• Not knowing people’s likes and dislikes
• Not knowing cultural, dietary, and lifestyle preferences
• Not knowing home addresses, especially with dispersed or remote teams

On top of all that missing information, there’s also a lot of admin around budgets, approvals, procurement, fulfillment, and other boring words. Finish it off with a cherry-on-top of fear (because getting it wrong can do more harm than good), and the whole thing seems hardly worth the bother.

That’s why so many organisations default to using gift cards for employees and clients.

Why businesses choose gift cards for employees and clients

Faced with 100s of employees and clients, gift-led recognition can be highly stressful. We’re talking about a logistical nightmare. We’re talking about an unsustainable mental load. We’re talking about overhearing ungrateful chatter at the post-work pints sesh, and having to stop yourself blurting the words “ungrateful” and “you try it!”.

That’s why many corporate gift cards for employees and clients can seem like a better option. 

Here’s why:

• There’s less admin: when you use digital gift vouchers for business, you don’t need to collect and check addresses. And with remote and dispersed teams, and people moving house or between flat shares, that can feel like a non-stop job.
   
• There’s less thought needed: you don’t have to deliberate over what to send, or what considerations you need to make about preferences. It’s a ‘safe’ option, and it requires minimal mental space.

But even if you pick the very best gift cards for employees (or clients), how effective are they really? 

The psychology of gifting: why thoughtfulness matters most

Let’s dig deeper, right inside the brains of your employees and clients (not literally, we must stress). Here are four reasons, rooted in psychology, that it may not be the best idea to use gift cards for staff recognition, or client appreciation:

1. Choice overload

‘Spoilt for choice’. It’s not just something your Gran would have said at a buffet - it’s a much-discussed psychological phenomenon, the idea that too much choice is actually a bad thing. Here’s an example…

One study saw that punters were much more likely to purchase (and enjoy) a gourmet jam when presented with a choice of six, compared to a choice of 24. An open-ended gift card - especially a cash card - can feel overwhelming, and people may feel less satisfied by their choice.

2. Emotional signalling

Personal gifts change the game from “here’s an object” to “here’s an experience”. One study found that personalisation raises your recipient’s self-esteem and makes them feel ‘cherished’, turning your simple act of sending a gift into a moment of human connection. Powerful stuff.

3. Perceived effort

Remember when we talked about that ‘fear of failure’ earlier? The one that makes gift cards feel like a safer bet? Well, time to reconsider. According to another study, personalised gifts felt valuable even when the people receiving them didn’t actually… like them. 

That’s because recipients can imagine the effort you’ve put in, and the processes that went into personalising their gift. It really is the thought that counts.

4. Cash = compensation

The trouble with gift cards is there’s no way to hide their value. Whatever brand they’re for, you’re saying “I recognise you THIS much”. Plus, research shows that employees view cash-related gifts as part of overall compensation - even if it’s not. 
 

So if you’re asking about the best gift cards for employee recognition, the answer is potentially… not gift cards at all.

Pros of gift cards

Let’s be clear: gift cards aren’t bad. In fact, Huggg offers a wide range of them. Here’s some of the reasons they’re often a popular choice for companies:

• They’re easy to send at scale
   
• They don’t require personal addresses
   
• They allow a wide range of choice
   
• They’re useful for non-UK recipients
   
• They’re a solid fallback when you don’t know the recipient

But sometimes you need to make a bigger impact. Communicate a greater level of appreciation. Encourage more human connection, inspire more delight. When it comes to really, really nailing employee recognition and client gifting, gift cards might not do the job. 

Cons of gift cards

Sending a gift voucher can be useful, but there are some drawbacks to be aware of. Here are 5 things we’ve learnt about the limitations of gift vouchers from business owners, HR teams, people leaders, and CX managers:

1. They feel transactional: because of the cash value, they feel more like compensation than recognition
    
2. They often aren’t used: gift cards get lost in inboxes, or expire - and who has budget to waste?
    
3. They create choice overload: as discussed, too much choice is overwhelming and surprisingly frustrating
    
4. They don’t feel thoughtful: no-one wants a gift that feels last minute, and you can’t tailor them easily
    
5. They don’t work for micro-gifting: sending £5 feels insulting, whereas gifting a coffee as a “nice work in the presentation” hits home

That’s why the organisations working with Huggg were looking for a better way. Something as simple as a gift card, without losing that human touch. A physical gift that just…. appears. Thankfully, that’s exactly what we do.

A better alternative: send a ‘gift with choice’

Fair warning: we’re about to toot our own horn. Toot toot.

Huggg doesn’t just do vouchers. It’s not a complicated employee recognition system either. It’s an evolution from generic gift cards for business, the next step up, a modern interpretation… you get the idea. 

Huggg is a platform that lets you ‘gift with choice’.

What ‘gift with choice’ means

Imagine sending a gift card. But instead of a gift card, it’s a curated selection of incredible gifts - tailored by theme, budget, and taste - which gives your recipients a small list of really, really good products to choose from.

Think:

• Wellbeing treats
• Tech and gadgets
• Wine and craft bevs
• Delicious snacks
• Eco-friendly options
• Non-alcoholic tipples
• …and many more.

It’s choice, but curated. It’s scalable, but personal. It’s fast, but thoughtful. It’s everything that’s good about personally-chosen physical presents and generic gift cards, rolled into one. 

Hard to imagine? Let’s walk through it together:

1. You head to Huggg’s ‘send a choice of gift’ section and select
   1. Where you’re sending gifts
   2. A category: like wellbeing, or Christmas
   3. Your budget 
   4. (optional) any gifts you want to remove from the selection
2. You add a message and a gift wrap
    
3. You send your ‘gift with choice’ Hugggs by
   1. Sharing a link in Slack, Teams, or any tool you use
   2. Email or SMS, using Huggg

It’s that easy. 

FAQs about gift vouchers & business gift cards

Are gift vouchers a good option for employee recognition?

They’re convenient and familiar, but they can feel transactional and impersonal. They work best when speed matters more than sentiment.

Are gift vouchers for employees tax-efficient?

Depending on your jurisdiction, some low-value gifts may be exempt (e.g. UK trivial benefits rules). Always check your local tax guidance.

What are the best gift cards for employee recognition?

The “best” option depends on what you prioritise: flexibility (open-ended cards), or impact (curated options). Increasingly, businesses prefer gifting models that offer guided choice rather than endless choice.

What’s the difference between gift vouchers and “gift with choice”?

A voucher gives one monetary value at one retailer (or a broad list). A Huggg ‘gift with choice’ gives a themed set of hand-picked, high-quality gifts - still with choice, but curated to feel thoughtful.

Are gift cards for staff still popular?

Yes, especially for large-scale programmes. But more companies are shifting toward more meaningful, curated gifting because it drives better engagement and redemption.

Can gift vouchers feel impersonal?

Yes, that’s the most common criticism. Many recipients see them as a “payment” rather than a personal gesture.

Are corporate gift cards for employees inclusive?

They can be, but many still exclude dietary needs, lifestyle preferences, and low-alcohol options. Curated collections usually offer better built-in inclusivity.

Can I customise gift vouchers for my business?

Some platforms allow branding, but full tailoring is rare. Huggg’s curated collections are fully theme-able to the moment.

What’s the most thoughtful alternative to a gift card?

A curated ‘gift with choice’ model - where the recipient chooses from a set of meaningful, human gifts - is the best of both worlds.

Conclusion: choose gifts you’d send your best friend

Gift vouchers aren’t going away. They’re a useful tool - quick, tidy, scalable, and people are used to them. 

But businesses want to make an impression, not a meaningless gesture. We know that people leaders and sales teams want to:

• to show appreciation, not just distribute money
   
• to create connection, not admin
   
• to offer choice without overwhelming people
   
• to make recognition moments memorable
   
• to give gifts that feel like someone actually cared

That’s why more teams are moving from generic gift cards to curated, human, quality gifts - and that’s what Huggg does.

Want gifting that’s simple for you and meaningful to them? Then you’re in the right place. Speak to our team, or try it out for free.