A study by First Data found that "overspending the amount of a gift card is the new normal." As well, as a business owner, you receive the money upfront.
Let's go a bit deeper into the world of Gift Cards.
Let's find out why gift cards are so in demand, why gift cards are interesting for businesses, a personal success business story related to gift cards and a few tips to get most out of it.
WHAT MAKES GIFT CARDS SO POPULAR? WHY ARE GIFT CARDS THE MOST REQUESTED GIFT
When offering a gift card, you avoid the awkward reactions of re-gifting. We all remember receiving a gift, we already received 2x, or it doesn't fit, and we have to go to the shop to change,... I wouldn't say I like that.
Many people like to shop and have a clear idea of what they want or need. With a gift card, the receiver is able to pick their own gift. This may seem unoriginal, but it is actually fun and more thoughtful.
Not only your friend can choose themself, but they also can plan when to visit the shop. They can wait till spring and use it for new spring items. Or even wait till the next year when they need a new cold-weather gear that otherwise is sold out.
Another advantage, for the receiver and you as a business owner, people tend to buy more expensive gifts, even paying some extra bucks. Gift cards are seen as free money.
WHAT MAKES GIFT CARDS SO INTERESTING FOR YOU, THE BUSINESS OWNER?
The previous reasons I talked about brings you happy customers, and happy customers are the base of returning customers, returning customers makes your company grow.
But there is more:
Gift cards can be promoted all year long, without creating crazy offers. People need gifts for many occasions, and when a person offers a gift card from your brand, this means the person knows the quality of your services or the person knows their friend will love it. In this case, you create brand awareness.
In both cases, the person promotes your business, and instead of you paying for promotion, you get paid as well.
Whether you're a retail store owner, a personal trainer, or just opening a restaurant; offering a simple, effective way to buy gift cards, will let you tap into the social network of your current customers for free.
I often ask local business owners, why do almost all famous retailers offer gift cards? Companies such as Starbucks, Amazon, Walmart, and Target? Spotify, Google, Apple? Because it is profitable, so why don't you copy this growth technique?
Let me tell a personal business story.
Seven years ago, I was running a spa, and we pushed the gift cards, and the result was incredible.
Customers, after a long day of work, had a one hour relaxing in our spa, they bought gift cards for their friends.
We made up to 14% of the monthly turn over from gift cards. That was 14% upfront money. In December, it went up t 30%.
Those numbers are a lifesaver for many businesses.
Would you say no to 14% monthly upfront payments?
There is one reason, I often hear why brands should offer gift cards, a reason I don't agree you should consider.
Many gift cards are never fully redeemed, and yes, you can see that as an extra profit, but you can do so much more to have more growth and profit.
You want your customers to be happy and to come back. So non-redeemed value on gift cards will help you to let customers come back easily.
When I knew a customer had still a value left on the gift card, I send them an email with a reminder. 100% of the clients were so happy we reminded them, as most of the time, they had lost the gift card. I immediately send them by email a copy of the gift card with the remaining value. A happy client is good for business.
As often, the left-over wasn't enough for the treatment; the customers paid the difference. Again extra sales
HOW DID WE PROMOTE THE GIFT CARDS
First, we placed a board anywhere we could. At the reception, at the coffee machine, even in the toilets. When customers left our place, they knew we offer gift cards.
Second, we placed them on our website. We sold a lot of gift cards. One extra tip. Don't treat a gift card as a regular product; make sure your gift cards are directly accessible from the main menu.
People looking for a gift card react differently than people looking for products on your online shop
After we sold the spa, I launched Masha.ai, an eCommerce platform to make it easy to sell your gift cards. Cheap, easy and safe. You don't want your staff wasting time verifying gift cards or paying an IT company to accept all types of credit cards, PayPal, Alipay, Google Pay, etc.
In fact, Masha.ai is free to use; you pay a small commission only when a gift card is sold. The commission is even smaller than what you give to your best clients.
What is even better with Masha.ai, they promote your gift cards, to their network of users.
Again extra free publicity and brand awareness.
Next to masha.ai, if you are using Shopify, you should add your gift cards to your webshop as well.
Gift cards are your answer if you are looking for an effective way to increase your sales. Gift cards offer a business with a lot of advantages – ranging from increased revenue to higher customer trust and loyalty. These main advantages allow you free up more time for you to run your business smoothly.
You could easily display your gift cards and offer it to customers who do not have an idea on what would be the perfect gift to give out to their special someone, family or friends. Surely, the receiver of the gift card will appreciate it more than receiving something they do not like.
Gift cards can bee a boom for your sales.
Gift cards are the #1 social selling tool that generates instant profit