Gift cards continue as the most popular holiday gift. National Retail Federation (NRF) data shows that six out of 10 consumers would like to receive a gift card and about the same number plan to give gift cards for the holidays. Restaurant gift cards top the list as the most popular, followed by department store, prepaid cards, coffee shop, and entertainment gift cards. And total gift card spending in 2018 was approximately $30 billion.
The ability to capitalize on this demand is just one of the benefits that gift cards offer merchants. Gift cards are a simple and effective way to keep a brand top of mind — when consumers open their wallets, the merchant’s logo is there. Gift cards can be an integral part of a promotional strategy to get some of that Black Friday traffic to return after the holidays. Merchants can offer gift cards as a reward for qualifying purchases, which shoppers can use on a future visit. Furthermore, surveys show that when consumers redeem gift cards, 59 percent of them will spend more than face value.
The Secret to Thriving Gift Card Business
For merchants to see an uptick in revenues and traffic from gift cards, however, they need a gift card solution that gives them the ability to meet shoppers’ expectations. Consumers want to be able to purchase and use gift cards easily and make purchases with them at any location or on any channel. This is especially important during the busy holiday shopping season when no one has time to waste. Consumers also want convenient ways to check their gift card balances and reload cards. Gift card experiences that fall short won’t build traffic, revenues and loyalty for merchants. In fact, they could have the opposite effect.
A gift card solution must also give merchants the ability to manage this revenue stream. The most efficient operations use modern gift card solutions with features including:
A processing engine that permits the merchant’s preferred technology, such as magnetic stripe, barcode or QR code
A fully integrated system that works with in-store POS, e-commerce and m-commerce
Fraud prevention, including monitoring and detection and user authentication techniques
Ability to issue gift cards for store returns
Integration with promotions engine and loyalty rewards program to enable collect data insights from promotions and consumer behavior
Flexibility to design cards to showcase the merchant’s brand
Are Your Clients Ready for the Holiday Gift Card Rush?
Depending on the market you serve, you may find it difficult to find a prospect that doesn’t currently offer gift cards. But it’s highly probable that you will find merchants using outdated systems that don’t equip them to provide the experiences that consumers demand.
VARs and ISVs can easily show potential ROI from traffic and revenue growth, as well as an increase in customer satisfaction. Based on your client’s goals, you can also provide solutions and services to help them market more effectively or analyze data to inform business decisions.
Be more than a solution provider as your clients prepare for the next holiday shopping season. Be a trusted business advisor who helps differentiate their business and sets a course for growth.