If you want to give a gift that is going to make the recipient happy, don’t give them what you think they’ll like. Give them a gift card. There’s data back this up. The National Retail Federation, reports that 62 percent of consumers prefer to receive a gift card over pretty much anything.
Why does this matter to you as a small business owner? Because another fact unearthed by the National Retail Federation is that a majority of all gift card recipients will overspend the value of the card. You can almost hear the cha-ching, can’t you? Gift cards can translate to more revenue at redemption.
The time, cost, and redemption barriers that once made the gift card more of a hassle than it was worth are over. The new reality is that creating a gift card system for your small business is easy and inexpensive.
Here are a few tips to keep in mind as you create custom gift cards for your business.
Find an affordable gift card supplierThere are lots of gift card suppliers out there, so do your research. One of the more popular and low-cost gift card suppliers is Square. Gift cards start at $1.50 per card with a minimum purchase of 125 cards. When a customer purchases a gift card, you can load the gift card value from your Square Register and receive the funds right away. There are no additional charges outside of the $1.50 charge and standard processing fee. Another perk of working with Square is you can choose a template or create your own card design that conforms to your brand.
Learn the applicable gift card lawsBy law, a gift card must have an expiration date greater than five years from the date of issuance or when funds were last loaded to the card. In some states, you may claim the cash value of unused cards after the expiration date. Other states require that you report the unused cards as unclaimed property. Unclaimed property must be surrendered to the state through the escheatment process. For more on the do’s and don’ts of gift cards read Title IV of the Credit Card Accountability Responsibility and Disclosure Act of 2009, especially the section on limits of gift card redemption fees and expiration dates.
Gift cards don’t sell themselves, you’ve got to promote themYou can’t purchase a gift card if you don’t know they are on offer. If a customer has done business with you multiple times in the past or is using your services regularly, it’s a safe bet that they like what you have to offer and would be willing to share gift cards with their friends. For loyal customers, you may consider offering a discount on your gift cards.
Gift cards work in any industryMany service-oriented small businesses seldom offer gift cards believing that individuals wouldn’t need, use or want a gift card for their service. Nothing could be further from the truth. Gift cards work in all types of industries: people need their gutters cleaned, teeth cleaned, dogs groomed, nails done, lawns mowed, cars detailed, etc.
Same goes if your business serves other businesses. Businesses need content written, websites updated, taxes completed. If you have anything to sell, a gift card will work for you.
The benefits of a gift card are as great for your customers as they are for your business. For your clientele and you, they’re easy to buy, use, and offer as an option that that helps everyone.
As a business owner, gift cards mean increased revenue, new customers and repeat sales with minimal overhead. Best of all, you can even reuse or recharge the gift card.
Creating a gift card program is a great way to attract new customers while providing an easy way for existing customers to share their love and passion for what you do. There’s money to be made in those gifts cards—don't it let get away.
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Tracie Rollins contributed to this article.