4 advantages of gift cards

Attract new customers
Increase brand awareness
Improve sales by selling and accepting gift cards
Reduce fraud

A great way to acquire new customers while retaining the loyal ones is to set up a gift card or gift certificate program. For retail stores and special-service businesses, such as bookstores and day spas, gift cards are extremely effective marketing tools that can be displayed at the cash register or front desk for easy access. Find more benefits of gift cards below.

1. Attract new customers

Gift cards are usually effective at a business accepting credit cards for products or services that most people want or need. For example, an electronics store that carries higher-priced items that many customers wouldn’t normally buy on a whim. Gift cards encourage people who might not otherwise visit your business to take a look around. This may result in future returns to make additional purchases.

2. Increase brand awareness

When your gift card design matches your company logo and branding, it essentially works as a free marketing tool in the customer’s pocket. As people purchase more gift cards to give to their friends on birthdays and holidays, your brand continues to be dispersed among new customers.

3. Improve sales by selling and accepting gift cards

Although gift cards are often set to a specific amount, many customers will end up spending more. The gift card encourages customers to enter the store and browse products. Once they’ve started shopping, it is likely that they’ll end up finding a product that costs slightly more than the gift card’s value. Paying only a fraction of the price is still better than paying in full, and your customer will leave satisfied.

4. Reduce fraud

The use of an electronic gift card allows for partial redemption, leaving the rest of the balance stored on the gift card and eliminating cash backs. You can also use gift cards for store credit, helping to reduce fraud that occurs when customers try to make expired returns for cash. Issuing gift cards in place of cash encourages more sales.

How Clover merchants are using gift cards

Gift cards are an often under-utilized way businesses can bring in new customers and maintain the customer base they already have.

Building and engaging with a customer base is an important aspect of growing a business and ensuring its longevity. Setting up a gift card program through the Clover Gift Card app is not only simple, but, with a little work and creativity, gift cards can help you boost profits.

Four Clover merchants share strategies for rolling out a successful gift card program that engages customers and ups sales.

Revolution Bakery

“During the holiday time, they’re really important. Visitors buy them as gifts for their family in town. I have little tiny gift card boxes, too. People are really excited that it’s one-stop shopping. You can buy your baked goods and buy a gift card!”

Owned by Dionne Christian, Revolution Bakery offers their customers a panoply of gluten-free baked goods. Dionne points out some ways her bakery benefits from selling gift cards.

What’s more, gift cards often turn new customers, looking to buy a treat for themselves, into repeat customers. And, offering gift packaging for gift cards can make the experience of receiving a card special and exciting and can turn gift cards into a go-to gift for customers. For businesses like Revolution Bakery, who also ship retail products, egift cards that can be redeemed online can also help build a customer base outside of a shop’s local community.

72 West

Steve and Jill Mitchael use gift cards to engage customers who would otherwise not be spending money at their eclectic antique and one-of-a-kind gift store, 72 West.

“Many husbands come in here and go, ‘I don’t know what to get my wife in here, but I know she loves your store. So I’m just going to get a gift card because that’s the easiest way she can get what she wants’.”

Retailers, especially those who offer unique or personalized goods, should keep gift cards at the ready for customers who may be unsure what to buy for a spouse, friend, or loved one. Considering about 74% of consumers spend more money than what was on their gift card, selling gift cards just about guarantees an upsell!

Curious Plantaholic

Curious Plantaholic, owned by Jennifer and Brandt DeLorenzo, also offers gift cards to customers who want to give their plant-loving friends and family something they’ll love. The couple have found that marketing gift cards heavily has big benefits for their business and their customers.

“If a customer purchases a gift card, we give them 10 percent off something else at the same time. So not only are we ensuring that a customer is getting a good deal when they’re here purchasing gift cards, but they’re going to come back, and they’re going to buy other items to go with whatever discount we provided. By bundling and offering incentives, it’s made it really easy for us to sell the gift cards.”

Make the most out of your gift card program by making gift cards part of your marketing strategy, promoting gift card sales and capitalizing on their redemption.

Hair Studio 18

Kat Jones, owner of Hair Studio 18, discovered a creative way to use gift cards to help support her business. She uses gift cards to allow customers to prepay for services they will redeem in the future.

“As a business owner, my overhead is pretty much double. I’ve got a mortgage and a rent payment at the salon. I’ve got utilities at home and utilities at work. The phone bill, everything you could think of, is doubled.”

Expenses are always a challenge for new businesses or those going through a difficult time. Selling gift cards can be a way of alleviating a financial pinch. Consider offering a promotion on gift cards during the last week of the month to help with month-end expenses, like rent.

How to accept gift cards at your business

Gift cards are an often under-utilized way businesses can bring in new customers and maintain the customer base they already have.

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Editorial Team

Topics: Gift cards, Marketing, Payments & processing, SMB

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