If you don’t talk gift card solutions with your clients until summer to help them prepare for the holiday season, you may be missing out on sales opportunities. Moreover, as a trusted business advisor, you could be steering your clients wrong with the perception that gift cards only bring in revenues for about eight or nine weeks per year.
The truth is that consumers want gift cards all year long. A Carat survey found that 57 percent of consumers gave gift cards most often for birthdays, and the second most common gift-card-giving occasion is graduations. Consumers also give gift cards for weddings, births, retirement, housewarmings, and holidays like Mother’s Day and Father’s Day – pretty much spanning the entire calendar.
Additionally, analysts predict a growing gift card market. Research and Markets expect the gift card market to grow at a CAGR of 8.3 percent from 2022 to 2026, reaching nearly $260 million, driven by strong e-commerce growth and, in some cases, continuing supply chain shortages. When the product isn’t available in time for gift-giving, a gift card is a good alternative.
With the demand for gift cards year-round, value-added resellers (VARs) and managed services providers (MSPs) should rethink the emphasis on the winter holidays and educate their clients on the benefits of upgrading their gift card solutions as soon as possible.
Benefits of Gift Card Solutions
Some of the benefits of gift card solutions that you need to make your clients aware of include:
The majority of consumers spend more than the face value of a gift card when they use it. The overspending on a $10 gift card is $51, and $106 on a $500 gift card.
Gift card solutions also give merchants tools to build customer loyalty. Incentives and promotions appeal to consumers. The Carat survey found that more than 60 percent of consumers planned to accept a gift card promotion deal in 2022, such as adding to the card’s balance or offering a bonus gift with a card purchase.
Gift cards designed can boost brand awareness throughout the year. Furthermore, when consumers receive a gift card from existing customers can learn about the business and become new customers. This can be a big boon, particularly for small and medium-sized retailers.
Customers have encountered a higher-than-average number of out-of-stock items due to supply chain disruptions in recent years. Shortages are one reason 58 percent of consumers say they would purchase more gift cards rather than gifting tangible products, helping to keep the revenues in the store. Merchants can also give gift cards instead of cash for returns to keep revenues high.
What Kinds of Gift Card Solutions Should You Advise Your Clients to Upgrade To?
When you’re prospecting or gauging interest in a gift card solution upgrade, be prepared to start a conversation with a business using a legacy solution and issuing only plastic gift cards. Today’s omnichannel consumers expect omnichannel gift card functionality. They expect to be able to purchase both physical and digital gift cards, send them via email or text, and redeem them wherever they shop.
Also, with gift cards sold and used on all channels, be prepared to offer gift card solutions with fraud prevention tools to protect their businesses and their customers.
Gift card solutions should also integrate with the merchant’s point of sale (POS) and payments systems and share data with loyalty and customer relationship management programs to provide valuable data that merchants can use to personalize customer experiences.
Additional features that can benefit your clients include:
- White Labeling: Merchants need to be able to white-label all aspects of gift card solutions, from print and digital cards to the reporting dashboard and virtual terminal.
- Centralized Reporting: Transactions of all types should be available 24/7 from a reporting dashboard.
- Easy Migration: A gift card solutions provider should support an easy migration to and from dozens of third-party gift services.
Why Wait Until the End of the Year?
With so many benefits of a gift card solution upgrade, your clients may be ready for the conversation in the winter or spring rather than waiting for your annual call in July or August. I can also mean months more of recurring revenue for your business this year.
Gift card solution upgrades offer value all through the year. Get that message across, and grow your business.