Holiday shopping season is fast approaching. This year, consider adding gift cards to your product assortment. A gift card from a specialty shop is perfect for the time-crunched holiday shopper: it’s both thoughtful and easy. And 74% of consumers say they like receiving gift cards as holiday presents.
Best of all, gift cards bring shoppers to your store twice: once at purchase and again when they’re redeemed. That’s two opportunities for shoppers to spend money with your business.
Shoppers with Gift Cards Spend More
Interestingly, studies have shown that coming into a store with a gift card effects customer behavior. Consumers shopping with gift cards are less price sensitive and more likely to buy higher priced items then they would be if they didn’t have a gift card to spend.
A study conducted by First Data reported that 72% of gift card users spent more than the amount of their gift card value when redeeming it, and 25% purchased something they hadn’t planned to spend money on. 8% of consumers with a gift card bought a more expensive version of something they’d already planned to buy. Another study showed that 72% of people who went to a store to purchase a gift card for someone else ended up making a purchase for themselves. As a retailer, all of this adds up to more money in your pocket his holiday season when you choose to offer gift cards for sale.
You can do even more to boost gift card sales by offering a gift card promotion in your shop. For example, when a customer spends over a certain threshold ($100, for example), they get a free promotional gift card (such as $10). Or offer a free gift card with the purchase of specific merchandise. And, if your shop has a customer loyalty program, be sure gift card sales are part of it.
Gift cards can also help to increase your sales after the holiday season has ended when recipients come into your shop, or visit your online store, to spend their presents. Maximize this boost to your first quarter revenue by offering an incentive to gift card recipients in January. (“Redeem your gift card this weekend and save 20%” is one example.)
Gift Cards Can Boost Brand Awareness
If you have a brick-and-mortar shop, plastic gift cards are a great way to help boost brand awareness for your store. Tucked into customer’s wallets, they to serve as a reminder to customers to come back in for a visit. Companies like Duracard allow you to upload your logo and branding, and even create seasonal gift cards for an extra-special presentation. Most gift card programs have no startup costs – you simply pay for the cards and the customization. When a card is purchased it’s has to be activated at the register to help prevent fraud.
Plastic gift cards are also an ideal product to donate to local charitable functions. They feature your branding which helps to boost brand awareness, and they bring the recipient into your shop where they may spend extra money. All the while you’re able to support your local community.
Digital Gift Cards are Ideal for Last-Minute Shoppers
Digital gift cards are the ultimate last-minute present; sent via email, they’re instantaneous. If your online shop is built with Shopify, you can issue digital gift cards if you have the Shopify or Advanced Shopify plan (this feature is not available with the Basic Shopify plan). Other options for generating digital gift cards are GiftFly and Roller, both of which generate a gift card that you can scan from a customer’s phone when they enter your store. GiftFly doesn’t charge merchants any fee – there’s a 3.99% per gift card $20 or less fee for buyers. With Roller customers can personalize the card with photos and videos before sending it to the recipient.
Whether you’re offering digital or physical gift cards this holiday season, be sure to market them to your customers via email and social channels. Gift cards are an ideal product to purchase online.
Be Aware of the Legalities
Although gift cards can help boost your sales in a number of ways, it’s also important to understand the legal regulations that govern then. Attorney and knitwear designer Carol J. Sulcoski has covered this topic in-depth for us right here including expiration dates for gift cards, inactivity fees, the differences between gift cards and gift certificates, and whether consumers can receive cash for the remaining value on a gift card if it’s below a certain threshold. Carol also addresses what happens to the value of gift cards that are never redeemed by the holder. These are important legal regulations for retailers to understand so be sure to check out her article if you’re considering offering gift cards in your shop.