Gift cards have been around for some time although their popularity has been steadily increasing lately. They can now be found offered by online retailers and the smallest boutique shops. Some small business owners, however, do not see the potential in offering gift cards. This is a serious mistake that could actually stunt the growth of the company. Here are three advantages of adding gift cards to your small business.
Gift Card Sales Are Recorded Immediately
One of the main advantages of offering gift cards through your small business is that sales of the cards are recorded immediately. Someone who purchases a gift card is really just paying you that amount in advance for merchandise that will be retrieved later. This means that you can accumulate sales and profits early instead of having to wait until later. The benefit is that those are guaranteed sales that will never go away. Even customer service issues with a gift card will result in issuing store credit instead of straight cash refunds. The idea of gift cards gets even more attractive when you realize that a large number go unused or are never fully emptied. Your small business gains that revenue practically for free.
Improve Order Totals
A reality of the retail industry both online and offline is that people using gift cards to make purchases tend to spend more. The gift card is seen as free money. This allows the shopper to spend extra personal money during the transaction. The result will be higher order totals throughout the year. Since over $200 billion in retail sales is done through prepaid and gift cards each year, you do not want to pass up this opportunity. If your gift cards become very popular or you use them as promotional giveaways, then you could see a steep increase in average order totals within your business. Providing customers with the option of buying gift cards for your small business can directly equal better revenue.
Create More Marketing and Branding Opportunities
There are around 28 million small businesses in the country all competing for consumers. Gift cards allow you to create more marketing and branding opportunities to stand out from the crowd. You can use the card activation process to advertise or promote new products. You can cover the cards with your logo and information to help spread brand awareness to new areas. You could even ask customers to sign up for newsletters or rewards programs when using the gift card online. A good and comprehensive gift card program gives your small business an entire new range of marketing options that would not be open to you otherwise. This important and growing tool should not be ignored when determining your business and marketing strategies.