Marketing with Gift Cards

Gift cards (certificates), when properly marketed, can increase online sales, encourage customer retention through repeat purchases, and help attract new clients. These are three essential elements to building a successful business. Every ecommerce store should have a healthy gift card program.

The Facts about Gift Cards

Shopatron conducted research that revealed interesting facts about gift cards’ impact on consumer behavior. Online retailers that create and market a gift card program correctly can expect an average increase of 10% in sales. It was also found that 31% of gift card recipients are more likely to buy items at full price (not on sales) than those who use other payment methods.

It found that gift card users spend 40% more on average per order than the gift card’s value. If you take this data one step further, and think about average order values, an online retailer looking to increase their average order value by $70 (as an illustration) might market gift cards $50 or greater more aggressively than lower denominations.

Stores looking to increase their customer base will be pleased to learn that 40% of those who are given a gift card for a store will actually visit that store, regardless of whether or not they have previously visited the store.

While it is important to attract new customers, it is not the only aspect of success. Retention of customers is key to greater profits and long-lasting success. This is where gift cards can be of great help. According to data, 72% of people who have received gift cards will return to the place where they purchased them. These two facts show that gift cards programs are able to both attract new customers as well as keep existing customers coming back.

Marketing gift cards

Gift cards can be easily promoted during holidays such as Valentine’s Day and Mother’s Day. This is because gift giving is at the forefront many customers’ minds. The data shows that around 81 percent of adults will buy gift certificates during holidays. But what can a store do to keep sales up by selling gift cards at other times throughout the year?

It is a smart idea to create a gift card category on your website. Make sure you promote the gift cards in different areas of your website, such as banners and calls outs to let customers know that they exist.

Promoting discount gift cards is another marketing strategy that works. A $50 gift card would be an example. It costs only $40. This is a great way to give a gift card to someone you love. It also gives customers $10 off their next order. Current customers know that gift cards can be used in conjunction with coupon codes, so they can double up with any coupon code to save even more.

An online store can drive sales by marketing’special’ gift certificates to existing customers in the above manner. Another way to increase sales is to team up with complementary retailers and give gift cards to each other. This also helps to create a gift card program that generates revenue. One example is a store selling custom wine racks/storage solutions that offers a gift card with every purchase to a complimentary store that sells wine, and vice versa.

Both businesses, which are complementary but not competing, benefit from the partnership. As a part of their sale, store “A” automatically gives the customer a gift card to shop “B”. The customer then uses the gift card to make a purchase at store “B”. Both stores gain from the transaction with store B, picking up a new client along the way.

Facebook and other social media platforms are very popular. Stores might consider using apps that link to these platforms, allowing customers to gift cards to friends. Social media’s virality and ease-of-use can be a powerful combination to market gift card campaigns.

Another way to increase gift card sales is to offer to donate a portion to charity. A pet shop might offer to donate $10 to the rescue shelter of your choice for every $50 spent on a gift card.

To encourage gift card purchases, and to ensure customer loyalty in future stores, reward points might be offered on each gift certificate purchase. This could include double reward points. To supercharge both, this strategy combines customer loyalty programs with gift card programs.

Different types of gift cards

There are two types of gift cards. You can either print physical items (similar to a gift certificate or credit card) or send an electronic gift card number via email.

The customer receives the physical gift card / certificate via post. Or, they can be purchased at brick and mortar shops from racks (displays that include hundreds of gift cards from different retailers). These gift cards are more expensive to market (printing, manufacturing fees may apply), but customers often choose these types of gift certificates when they wish to include something tangible in their package.

The recipient receives electronic gift cards via email. They are usually less personal and not as tangible. They are free for the retailer and can be printed multiple times by the recipient. However, because they are impersonal, it is often a little more difficult to market them than their physical counterparts.

All gift cards, regardless of whether they are printed or electronic, work the same way to retain and attract customers. While the marketing effort to promote them to consumers is different, the overall effect on businesses remains the same.