Many retailers underestimate the impact that gift cards can have on their profit margins. Gift cards are often viewed as a pain – yet another little detail that a business owner has to deal with. But in reality, they often equal free money for you and your business!
Think of it this way: these days, in what is still quite a tenuous economy, the best gift of all is money. That’s why customers like to buy and give gift cards. For those purchasing them, it saves the trouble of thinking about what to get their friend or loved one. For those receiving the card, it’s a gift of free money for their favorite store. But what’s in it for you, the business owner?
For starters, every gift card you sell gives your business an influx of cash, without having to give anything away. Boosting your bottom line without losing anything in return is a great thing for any business. Now, add on the possibility that not all gift cards get redeemed, and you’re looking at free money. In effect, you collect payment without providing a service or merchandise when those gift cards fall by the wayside.
Offering gift cards is a great way for your business to set itself apart from the competition while also opening yourself up to new customers. Let’s say a current customer purchases a gift card and gives it to a friend of theirs for her birthday. If the recipient has never yet shopped at your store, they’re equivalent to a new customer.
Because they have a gift card to spend, they’re likely to come in and have a look around. If they like what they see, they’re likely to spend the amount given on their gift card, and then some. On average, gift receivers spend more than the value of their card. Even better, if they like their experience in your store, they’re likely to return. This means your business has gained a customer with no extra legwork or money put out by you. Best of all, gift cards give friends a chance not only to discuss your business, but recommend it.
Regardless of the size of your business, big or small, gift cards are a great idea and a great opportunity for your company to increase its bottom line. Your merchant service provider can help you set up a gift card program in which transactions are handled by a credit card processing terminal, making implementation and tracking simple. In short, the addition of gift cards, while making a big change to your income, won’t require a big change in terms of the payment processing systems you already have in place.
Gift cards mean lots of gain for very little effort on the part of the business owner, making them a great idea for a wide range of retailers and business owners. Gift cards are the gift that keeps on giving, turning a piece of plastic into free money, new customers, and continuing business.
