Use Gift Cards to Drive Sales and Reduce Processing CostsAs the holiday shopping season winds down, I reflect on some of the activity that I witnessed. Specifically here, I'm really just talking about how I saw Gift Cards being used. This year, unlike many in the past, there were several large retailers as well as national restaurant chains offering things like "Buy a $20 Gift Card and we'll add an extra $5 on us", or, "Buy a $50 Gift Card and we'll add an extra $10". Obviously, if the big national chains are doing it, then there must be excellent benefits to it driving future sales. Let's take a look at some ideas that you may be able to incorporate into your marketing that maybe you aren't utilizing yet in regards to Gift Cards. All of this, of course, takes into consideration that you are currently using Gift Cards in your establishment.
GIFT CARDS TO CAPTURE PINNED DEBITS AND SAVINGS:
If you have a pin pad in your establishment, then savings on your processing costs are available right at your fingertips. If you haven't already been enlightened, pinned debit transactions save you money over running them as credit transactions. But, many merchants, and their employees, don't do a great job in attempting to get customers to enter their pin number. I recommend to all my merchants that they put up a counter top sign that says something to the effect of "if you're paying with a debit card today, please enter your pin number as it saves us in processing costs". Or, of course, you could come up with something to that affect. But, here's a way you could utilize Gift Cards to help in this endeavor. Get yourself a fish bowl and preload a bunch of your Gift Cards with values ranging anywhere from $1 to maybe $20 (you can decide the values but just try and mix it up some). Then, put a sign on the counter that says "Enter your pin and win" or "Enter your pin and take a dip"....something along those lines. So, once they enter their pin number, they get to pull a card out of the bowl and it will be good on their "next visit". The obvious goal here is to get them back into the store again and they will virtually always spend more than the value on the card. National averages indicate that gift card holders tend to spend at least 20% more than what's on the card.
GIFT CARDS TO INCREASE YOUR AVERAGE SALE TODAY:Here's an idea that could help boost your average sale today. Everybody likes a deal, wouldn't you agree? Let's say you have a customer comes to the counter and their purchases come to $42. Why not put up a sign that says something like "Purchases over $50 earns a $5 Gift Card" or "Purchases over $50 earns a 10% bonus on a Gift Card". It may just be an enticement for them to go back and find something else to add to their purchase today. And, of course, the Gift Card they are awarded is good towards their "next visit". Let's face it, if you're keystoning everything in your store and you give a $10 Gift Card, it's really only costing you $5 and will bring in more future sales.
GIFT CARDS ON RETURNS:This is a strategy that could always be used when someone comes in with a return. Most often, buyers or recipients of gifts simply want a credit to their credit card or cash whichever is more appropriate. Of course you want to be accommodating to whatever they want. But, doing either of the aforementioned returns sends them packing with what was once a sale and money in the till. Offer them what they want but possibly give them an alternative such as "we're happy to refund your money on this transaction, however, as an alternative, we'd like to offer you a Gift Card for your refund with an additional 10% bonus, or $5 bonus, or whatever". Again, the idea here is to try to get them back in the store and respend what was originally spent and hopefully, more. Actually, they may come back, use some of the Gift Card and not deplete it completely which would bring them in again. The more often you can get them in your store, or restaurant, the more likely you are to do future business with them.
GIFT CARDS AS LOYALTY CARDS: Some merchants use Gift Cards as a form of Customer Loyalty card if they aren't actually using real loyalty cards. For example, tell your customers, or display in your establishment that "all purchases over $20 earn a reward of some percentage automatically added to a Gift Card". And, once again, this Gift Card is good towards future visits. The difference between using Gift Cards as a form of "rewards" type program over using an actual Loyalty Card is that Gift Cards are in dollar denominations and loyalty cards can be either dollars or points. You get the idea...just keep looking for ways to drive those sales.
Well, hopefully these ideas help to get your creative juices flowing. My goal is always to go above and beyond in trying to help my merchants to save on their costs and increase their sales, I pray that 2011 will be a prosperous year for you. Have you capitalized on the phenomenon of mobile text marketing yet to drive sales? I can share ideas with you on that subject as well that will blow traditional marketing methods out of the water at a fraction of the cost.
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