Halo vs horn: What does your corporate gifting say about your company?
Posted on March 7, 2023 by Megan Goodfield
‘The halo effect’ – it’s a concept and a buzz-phrase that gets bandied around a lot these days. But what is the halo effect? If you’re unfamiliar with the term, it can be summarised as follows: it occurs when perceptions of a business are uplifted by its association with another, widely-liked business.
This ‘association’ is usually forged through a partnership, which can take many forms. It could be a collaboration: a high-street clothing brand collaborating with a haute couture label, for example. It might involve sponsorship e.g. a multinational bank funding a charity’s large-scale project.
Or, the halo effect can be achieved through corporate gifting: a company provides its customers or employees with gifts from a well-regarded brand, and – ta-daa! – perceptions of the company are elevated as a result.
That’s the theory, anyway.
But is the psychological phenomenon of the halo effect a genuine and commonplace occurrence? Or is that wishful thinking on the part of marketing and HR departments looking for an easy way to boost a company’s reputation?
At M&S Corporate Gifts, we recently commissioned an independent survey of 1,000 UK residents, drawn from all age groups and backgrounds. We wanted to better understand how Britons’ perceptions of companies were impacted by the gifts, incentives and rewards offered by those companies.
In other words: If Brand A offers a person a gift from Brand B, do Brands A and B really become forever associated with each other in that person’s mind? And if so, what does that mean for Brand A?
Here’s what those 1,000 survey respondents told us:
- 71% say that if a company offered them a gift card from a trusted, premium retailer, it would positively impact their opinion of the company that gifted them.
- 64.1% agree that if a company offered a gift card from a brand with a strong ethical reputation, it would positively impact their opinion of the company.
- 70% of people say they’d prefer to receive a gift card from a retailer with a good reputation for sustainability and ethical working practices.
- The above preference is even more pronounced in the younger generations: 83.3% of 18–24-year-olds and 83.6% of 25–34-year-olds say they’d prefer to receive a gift card from a brand with a good reputation for sustainability (compared to 58.2% of people aged 65-plus).
On this evidence, the halo effect is not only real, it’s something that should be front-of-mind when considering brand partnerships for customer or employee gifting activity. (For one thing, it’s probably wise to not discount the wishes of 83% of 18–34-year-olds…)
100 years of halos
Despite its enthusiastic adoption by modern business gurus, the concept of the halo effect is actually more than 100 years old.
Psychologist Edward Thorndike first coined the term back in 1920. Thorndike oversaw an experiment in which he asked commanding officers in the military to evaluate a variety of qualities in their subordinate soldiers – characteristics such as leadership, physical appearance, intelligence and loyalty.
Thorndike wanted to determine how the commanding officers’ ratings of these qualities bled into each other. For example, if they rated a subordinate soldier highly for loyalty, were they also likely to rate them highly for intelligence?
As you might expect, Thorndike found that high ratings of a particular quality led to high ratings of other characteristics. (On the flipside, negative ratings of a specific quality led to lower ratings of other characteristics.) If a commanding officer believed a subordinate was strong in one area, association led them to assume they must be strong in all areas – the halo effect in action.
Since then, countless studies have backed up Thorndike’s findings. An experiment conducted in 2022 found that when participants rated people as attractive, they also tended to believe that they were strongly moral, highly personable and of above-average intelligence. And this greatness-by-association runs deep: a 2008 experiment found that people deemed attractive were also more likely to be found ‘not guilty’ in a jury trial.
Obviously, companies are not soldiers, nor are they on trial. But by looking at the above experiments we can see how the halo effect can manifest itself in gifting activity.
When Brand A uses gifting to associate itself with the well-regarded Brand B, perceptions of Brand A are uplifted by osmosis. And not just in one area, but across the board. Brand B may be most renowned for its high-quality craftsmanship, for example, but by associating itself with Brand B, Brand A not only improves perceptions of its own craftsmanship, but perceptions of every aspect of the business.
The horn effect
The horn effect is the counterpoint to the halo effect’s greatness-by-association. It’s a cognitive bias that negatively colours our judgements of a person – or company – based solely on a single piece of information.
An example: During a job interview, a candidate makes a single negative remark. Displeased and distracted by this remark, the interviewer decides that the candidate is entirely unsuitable for the role. No matter how well the rest of the interview went – or how strong the candidate is on paper – this solitary remark has dragged down the interviewer’s entire perception of this person.
So how might the horn effect manifest itself in business terms? Well, take that 83% of 18–34-year-olds who say they’d prefer to receive a gift card from a retailer with a good reputation for sustainability and ethical working practices. If a company offers them a gift card from a retailer that’s notoriously poor in those areas, their perception of that company is going to be negatively impacted. It’s guilt by association.
Choosing halos over horns
It’s clear, then, that choosing a brand partnership for corporate gifting requires some careful consideration. Choose wisely, and perceptions of your company get a nice little uplift. Make the wrong choice and, no matter how enticing the gifts themselves, your company’s reputation is going to take a knock.
Partnering with M&S Corporate Gifts offers your business instant and ongoing access to the halo effect – because M&S is synonymous with quality, prestige and ethical values.
For proof of this, let’s return to our recent survey of 1,000 UK consumers. When asked if receiving an M&S Gift Card would make them feel more positively about the company that gifted them, a full 80.7% affirmed that it would.
Read our full report – shaped by our survey of 1,000 UK consumers – on the true impact of corporate gifting.