According to a study, a significant portion of the entire consumer populace both love to give and receive gift cards. More often than not, these lure customers to spend more, oftentimes without them realizing and a lot of retailers from all over the world are grabbing that opportunity to maximize their profit. Hence, it’s no surprise how to them, gift cards are a huge boon.
However, while gift cards come with perks, retailers including those who sell gift cards online may commit certain mistakes that, if left uncorrected, can curb their efforts and affect their sales in the long run. Below are five of them:
Table of Contents
- 1 Mistakes To Avoid in Gift Card Selling
- 2Avoid committing this mistake, do the following instead:
Mistakes To Avoid in Gift Card Selling
1. Not taking local gift card laws and regulations into account.
Laws and regulations concerning the production, usage, forfeiture, and disposal of gift cards already exist in a lot of countries worldwide. In United States, these laws may vary from one state to another. This is why, as a gift card seller, it is important that you are aware of the laws in your current area or coverage. Otherwise, your business can end up going through a backlash and suffer the consequences of having unhappy customers.
For instance, last year, bad press was noticed in a few stores in California upon their failure to adhere to the state’s laws about gift cards specifically on the clause of gift card for cash redemption. California’s law states that only below $10 can be redeemed out of gift cards in exchange for cash.
To avoid committing this mistake, you have to be updated about the state’s laws and make sure your store’s gift card policies are compliant with these laws. Other matters you should watch out for include fees, expiration dates, redemption, and disclosure of gift cards. Make sure your store and staff are educated enough to be able to adhere to these clauses.
2. Not accessorizing gift cards.
Gift cards are oftentimes used as a gift. However, they are boring naked. Not wrapping a gift card up with a cardholder or a pouch, although it is an additional expense on your part, actually degrades its aesthetic value and may consequently discourage your customers to purchase again.
The more gift cards are accessorized, the more their “gift-ready” feel is enhanced. Hence, it would be wise if you put every gift card in a box, pouch, or a cardholder or do better by attaching a bow on each card and putting it inside a small paper bag to make it more “gift” like.
3. Selling gift cards only on busy shopping seasons or Christmas holidays.
Special events and holidays are the times where sales of gift cards reach their peak. However, it does not necessarily imply that gift cards hardly sell on ordinary days. History shows that gift cards are a popular gift choice at all times because of how convenient and easily accessible they are. Hence, waiting until holidays to offer them is not a clever move if you want continuous cash flow.
What to do instead?
Before the peak seasons arrive, make sure your staff are already adequately trained and oriented about the gift card policies and technical details. Moreover, take this time as an opportunity to test drive your gift card program to further smoothen it. You can test drive in light of the following areas:
- Design – Make sure the designs of the gift cards you are selling are appropriate for the upcoming holidays. Choose the ones that potentially sell out and make that order as early as possible before supplies run out.
- Marketing – Everything in the marketing area should also be laid out smoothly. Where you plan to market your gift cards should be early identified.
- Merchandising – Strategic locations for your gift cards should be identified too.
- Technology – Make sure your gift cards can be scanned into your point of sale and inventory systems. This will help speed up the checkout process.
4. Neglecting the power of marketing
Unless your product is a basic necessity, you can never expect your target market to flock to your store to buy it. That said, gift card is clearly not a need. It’s a want. And nowadays, the market is already flooded with a lot of “wants”. Without proper marketing, your product will not be able to sell out.
Although gift cards are a popular gift choice, there’s a huge competition out there waiting to take advantage of you not investing in proper marketing. If you want to keep up with that competition, you should at least acknowledge how powerful and valuable marketing is.
The good news is, you actually need not be afraid of marketing investments as the potential ROI is usually high. Once the good word about your gift card program is spread throughout your target niche, your sales will surely improve.
Your marketing program should focus on the following:
- Enhanced in-store visibility
- Advertising gift cards on different channels including online
- Creating gift cards that match specific occasions or events
- Introducing gift cards to new customers
- Distributing gift cards to other retail stores
5. Using outdated or ugly gift card designs
Designs play an important role in ensuring your sales, so do not skimp on them. Invest in card designs if you do want your gift card program to click in the market.
Of course, customers will opt the more appealing and relevant ones. While it feels good to save money, this is business. If you want to thrive, you should not be afraid to invest instead of settling with only a single design.
Avoid committing this mistake, do the following instead:
- Display a variety of gift cards at your physical store. Your options should be wide enough. The more options there are, the lower their chances of getting out the store empty handed.
- Also, make sure you have available gift cards for common occasions like major holidays, graduations, birthdays, baptisms, weddings, and a lot more.
- Keep an eye on the latest trends when it comes to gift cards. You should know which designs click better.
- Assess your gift card program’s performance on a monthly or quarterly basis to make sure your offerings stay relevant and interesting.
Hope this guide can help you to learn and Mistakes To Avoid in Gift Card Selling and save your time. So its important to understand the need of your customer and give them what they need, so your business can grow faster.