Shop Talk: Practical answers for tough business questions
Question: What do you think about plastic gift cards? Are they worth the investment?
Answer: These days, gift cards are a minimal investment for a great deal of return. There are many advantages to offering gift cards rather than paper certificates. First of all, they fit into a wallet and carry your store name and logo, so customers are constantly seeing your brand, bringing your store to mind each time they open their wallet. Because you swipe them like a credit card to activate, they take less time at the sales counter than writing out a certificate. They’re easier to track because the balances are held on the card, making look-up a breeze. You also have the ability, with most gift card processing companies, to create and track a loyalty program for your customers if your point-of-sale program doesn’t provide it or you don’t have a POS. Statistically, customers with gift cards spend an average of $33 more than the card’s value. They also are a great way to bring in new customers who receive the cards as gifts from friends.
First published in Vol. 26 No. 6 of Retailing Insight. © 2011 Continuity Publishing Inc. All rights reserved.