How to get the most out of your gift card programJuly 2021
Whether you’re a restaurateur or retailer, a gift card program is a fantastic tool to help you not only attract customers, but also make more money. We’ll show you a few simple ways you can take your gift card program from ordinary to extraordinary and get the most out of these popular schemes for your business.
What is a gift card program?
A gift card program allows businesses to sell redeemable gift cards for their merchandise to their customers. There are two kinds of gift cards to consider when starting up your program: open and closed loop gift cards. Both of these options can benefit retailers and restaurants, but generally speaking, closed loop cards are the best for a small business.
Open loop gift cards are cards that can be used anywhere. Closed loop gift cards are cards that are made especially for your store. For small to medium businesses, we recommend offering closed loop gift cards because they’re specifically made to be used in your store, rather than everywhere.
Why are gift card programs great for businesses?
Selling gift cards can be a big help to any business without too much effort on the part of the business owner. Gift cards were an essential part of keeping small businesses afloat during the mandated closures brought on by the COVID-19 pandemic, because they are such an easy way for customers to support their favourite businesses.
They boost sales
Additionally, gift cards are a great way to boost sales. Studies show that customers are willing to spend more with a gift card versus spending their own money. Selling plastic gift cards Increase gift card sales by up to 35%. Giving a retail gift card as a gift can bring in new customers, too. Gift cards are primarily given as birthday, holiday or thank you gifts. Your loyal customers can give a gift card to a friend, who, for you, is a potential new customer. Let’s say one of your best customers gives their friend a gift from your boutique. if your customer gives their friend a gift card to your boutique, they have no choice but to visit your shop to redeem it. 44% of people in a study visited a store that was new to them because they received a gift card and even more people visited stores more often after they got gift cards.
They build brand awareness
Gift cards can also be a strong form of building brand awareness for a business. A gift card has a store’s logo, name, social media and contact information on it. Plus, an increase in gift card sales means a potential increase in the number of people seeing your gift cards. You never know who will see a gift card from your store and be curious enough to look you up. So whenever a potential customer looks in their wallet, they have a reminder that you’re a retail destination.
They’re cost effective
They’re also very cost effective. Plenty of gift card programs don’t have any start-up fees. All you pay for are the physical cards themselves and customization. You don’t have to sell a certain number of gift cards to keep your program going and selling closed loop gift cards means there’s no fee to you. However, you may have to pay a certain percentage when selling open-loop gift cards, and that fee will be dependent on what company you’re getting them from.
Because gift cards are so easy to sell and use, it’s important to pay attention to the laws surrounding them. Not being responsible with how gift cards are used within your store can not only drive away customers but get you in trouble with the law.
Looking to start a gift card program for your business? please get in contact with Cards Plus on 011 894 3914