Benefits of Gift Cards for Merchants & How to Get Started
With sales sinking over the past few months due to COVID-19, selling gift cards is an essential solution for helping to keep your doors open, especially among the merchants our payment technology company serves in two states that have been hit the hardest: New York and New Jersey.
In addition to the obvious – gift cards for merchants help increase revenue. Read on to learn how else your business can benefit from selling gift cards and how to quickly and easily get started.
1. Gift Cards for Merchants Increase Brand Awareness
Brand awareness is a marketing term used like its name suggests. It refers to how familiar consumers are with a brand. When your gift card is sitting in a consumer’s wallet or an eGift card file is on their computer, they are being exposed to your brand.
2. Gift Card Programs Can Improve Cash Flow
In the wake of COVID-19, selling gift cards has been a helpful way for businesses to generate revenue in advance of providing products and services they may not be able to provide at this time due to store closures. People across social media are supporting their favorite local merchants by purchasing gift cards and are encouraging their friends to do the same.
3. They Give Recipients the Option to Buy What They Want
Not sure what to get your loved one for their birthday or other special event? Gift cards provide them the chance to buy what they want. Unlike cash, gift cards are more personable; giving a gift card to your loved one’s favorite restaurant for example can show that you pay attention to what they like.
4. Gift Cards Are Safe and Convenient
On a small scale, traditional paper gift certificates can be enjoyed and remain popular. But today’s gift cards are safer and more convenient than paper certificates that are vulnerable to loss, theft, or fraud from duplication. As for convenience, you can accept gift cards the same ways you accept credit and debit cards: online, in-app, or in-store.
5. Gift Cards Can Create New & Returning Customers
Let’s say Sally loves your restaurant and thinks her friend Melissa will too so she gets her friend a restaurant gift card to your steakhouse. Customer who purchase your gift cards can become ambassadors of your brand. Instead of just spending the $50 gift card, Melissa spends $100 and learns she loves your prime rib so she makes another reservation a few weeks later. This is an example of a gift card that opened the door for a deeper engagement and new customer.
Approximately 72% of consumers will spend more than the total value of their gift card when making a purchase, according to Revel Systems. During the pandemic, this same rule applies but gift card spending is being done differently with takeout and delivery orders. Plus, eGift cards are becoming more popular.
Bonus Tip: They Are Perfect for Last Minute Shoppers
Forgot about an upcoming birthday or anniversary? Or perhaps a gift you ordered for someone has not been delivered in time? Gift cards make excellent last minute gifts. One study that was cited by Revel Systems found that people 25.70% of people surveyed said they prefer to buy gift cards because they are easier and faster to buy.
Gift Cards by the Numbers
- Gift cards are the #1 requested gift over the holidays.
- Approximately 60% of surveyed consumers said they would prefer to receive a gift card instead of items such as electronics, clothing, or other entertainment media.
- The gift card market grows 10% annually.
- eGift programs are growing 200% annually and customers load eGift cards with 10 to 15% more than plastic cards.
Gift Cards for Merchants by Priority Payments Local
Our partner Valutec is a comprehensive provider of prepaid card services, including gift cards and reloadable cards, with end-to-end solutions for development, processing and administration of stored value programs.
Valutec’s gift card program is a revenue-generating program that enables you to build your business and improve your cash flow. This Priority Payments Local partner works closely with each merchant to create the highest potential for additional revenue streams, brand building and customer loyalty.
With flexible card ordering options, Valutec offers a scalable solution to meet the needs of any size merchant. Its program is uniquely structured to provide the individual touch required to successfully support multi-location retailers. Regardless of a merchant’s size, Valutec provides the products and activity reporting needed to successfully market gift cards and track their program’s performance.
Merchants work with Valutec’s in-house graphic designers to customize their cards for maximum brand exposure. In addition to the cards themselves, Valutec provides a variety of complementary products to enhance and maximize each merchant’s program. Some of these products include:
- Custom merchandising
- Loyalty marketing
- Virtual cards with online fulfillment
- Direct mailing campaigns
- Third party distribution
Regardless of the program selected, cards are easily activated, redeemed and reloaded at the point-of-sale (POS). Valutec offers automated, monthly funds reconciliation for multi-location merchants. The robust reporting package allows merchants to access data for all transactions captured on the host database during a specified time period, as well as total fees billed.
Your summary will aggregate transactions at the corporate level and provide details for each location. Custom reporting formats can also be created to accommodate additional information requirements.
How to Get Started with Gift Cards for Your Business
- Contact us to let you know you would like to get started – we are currently offering a free set up with no monthly fee for three months.*
- Complete our retail fulfillment paperwork that will get your account built at Valutec.
- Our Valutec Account Representative will then build your account and get your physical cards and eCards ready for online fulfillment.
- If you do not already have one, we will create an Authorize.net account that will be used as your online credit card payment gateway for the gift card online cart.
Sample Merchant Screens
