Employee gifting is fast becoming a core part of how companies boost morale, reward performance, and strengthen company culture. But there’s a surprising twist: most employee gifting doesn’t happen through HR tech platforms.
Today’s HR teams are more invested than ever in ensuring their people feel recognised and appreciated. Whether it’s a birthday gift, a reward for going above and beyond, or a thank-you for years of service, ad hoc gifting has become part of the day-to-day employee experience.
Except, hang on a minute…
None of the tools these HR teams are using are actually HR platforms. Instead, employee gifts are being distributed via…
- The standalone employee recognition and rewards tech space.
- Expenses and benefits systems that have been imperfectly adapted to deliver something more ad hoc.
- Consumer gifting platforms that were never really intended for business use.
So why isn’t this part of HR tech’s buffet of features? From an HR manager’s perspective, it makes perfect sense – the more parts of their job they can do in one place, the better.
But the road to making that happen has either followed:
- The new but financially risky route of building regulated fintech features in-house
- The traditional and time-consuming route of creating partnerships with retailers
The first route is too slow and unprofitable, the second contains too many unknowns, and so this has not become a priority for innovation.
But if the financial risk and difficulty of the second route can be taken care of – and with embedded finance, it can – then employee gifting and HR tech becomes an opportunity that makes too much sense to ignore.
Why employee gifts aren’t all that rewarding
As it stands today, HR managers don’t have an awful lot of choice when it comes to giving an employee a spot reward or an ad hoc gift. Usually it boils down to one of these ideas:
- They can give them a physical gift like a bottle of wine or some flowers and claim it back on expenses
- They can give the employee a gift card or a voucher, having to ask finance to pay for it, or again claiming it back after paying out of pocket to buy it
- They can use some kind of employee recognition or benefits system and offer something that’s less tangible such as points or digital kudos
But there are two common problems with each of these solutions.
The first issue is they usually involve bending another system – like the company’s benefits platform or expenses process – around to work as a gifting channel, making it harder to keep track of the context behind those ad hoc transactions.
The second is that in each case, the employee’s joy at getting a reward depends entirely on their HR manager deciding what they’ll most like. That might work in a microbusiness where the HR manager knows everyone personally, but even a personalised gift card isn’t a perfect solution.
What if you’ve given an employee a gift card for a book chain…
….but they prefer to buy their books secondhand because they can get more books for less?
What if you want to give a retiring employee a gift towards an activity they love (and now have the time to do)….
…but you can’t find anywhere specific to that activity that actually offers gift cards?
And on the extreme end – when a company is too big for the HR manager to know everyone’s likes and interests – gifts end up becoming so generic that employees feel more disappointed than valued when they get them.
Because while it might be nice to receive a £50 gift card for your work anniversary, if it’s the same general online retailer voucher that everyone else in the office gets, it makes you wonder if they’ve really paid any attention to you since your last workiversary.
Meanwhile, the manager still has to go through all the faff of buying the gift card externally, claiming back the cost on expenses, making sure the e-voucher code ends up in the right inbox (but not before they’ve had a chance to tell the employee it’s coming). It’s an awful lot of effort for a solution that isn’t even close to perfect.
Personalisation: just let the employee decide what’s relevant
Let’s take that employee who loves secondhand books as an example and imagine an alternative way of gifting.
Their work anniversary is coming up, so their HR manager wants to give them a £100 gift to spend and knows how much they love reading. And here’s how that process looks:
- They log into their HR platform and go to “Send a Gift”.
- They put £100 as the amount, write a workiversary message, then tick the box that allows the gift to be spent with books and music retailers. If they want to, they can add more options – maybe food and drink, so the employee can take their new read for a coffee and cake.
- They press submit, and get on with the next task on their list.
Behind the scenes, the platform generates a card that can spend up to £100 from the company’s gift budget and sends that to the employee. It sorts out the spend controls so that the gift can’t be spent somewhere other than intended, but without making it so strict that the employee only has one place they can use it.
When you look at what goes on to make this happen, it’s probably clear why HR platforms haven’t done anything like this before.
Creating and offering cards is highly regulated, fiendishly tricky and carries an aspect of financial risk if the compliance and control isn’t done right.
In other words, it’s not something you can just build onto your platform overnight.
But that was then. Now…
Now, embedded finance solutions like Weavr enable HR platforms to plug cards and other financial features into their app without becoming a fintech themselves, with the regulation and compliance details taken care of, so embedders only have to integrate it into their tech stack and toggle on the features they want.
What that leads to isn’t just a more satisfying gift and reward experience for employees and HR managers. It leads to a platform that’s indispensable for HR teams.
Think about it – the person in a company who’s tasked with issuing ad hoc gifts and rewards to employees is usually the HR manager, and they already live on your HR platform 90% of their working day. Why not join the dots between the place they already do most of their work and the final 10% of tasks they can’t currently use it for?
It also makes much more sense for the head of finance in the company. They already have dedicated systems to oversee payroll, petty cash use, expenses and benefits, but nothing for ad hoc gifting. They want a standard, official way of seeing where these small amounts of money are going and why, and HR platforms with embedded finance can give them that without contributing to SaaS sprawl.
And for the embedders themselves, it leads to more profitable HR tech – not only from upselling your new gifting and reward features to existing users, but also from making additional revenue on transactions using your cards.
If you’re wondering what place embedded finance might have in your innovation roadmap, set up a meeting with one of our experts or take a look at our guide to how embedded finance boosts revenue for SaaS platforms.
