Friday, December 9, 2011

Redeem Gift Card Profitability

Starting in year 2007, gift card sales by retailers dropped sharply. This was disappointing, since gift cards are good moneymakers. The shopper with a gift card is more likely to browse your aisles than is the shopper without a gift card. At the least, they become better acquainted with the scope of your merchandise selection. At best, they’ll see a great many items they want, so they’ll spend some of their own money in addition to the gift card allotment. In addition, research indicates that when a customer purchases a product with a gift card rather than with other types of payment, the probability of him returning the item is lower.
     Now gift card sales are climbing again, many in the form of e-cards. This provides you and your staff opportunities to turn those advantages to your advantage. Based on BIGresearch survey findings, the National Retailer Federation estimates 80% of holiday season shoppers will purchase at least one gift card during this holiday season, and the average amount per card will be about $43.00. NRF predicts that men will spend a total of about $164.00 on gift cards, while for women, the total will be about $147.00.
     But that’s only part of the story. The most common occasion for gift cards is not the holidays. That’s in second place. First place is birthdays, and birthdays come on every page of your retailing calendar.
     When redeeming gift cards, recognize that browsing does have a downside. Many gift card shoppers enter the store without a clear idea of what they want. Their objective is to buy something rather than to acquire the benefits of a particular sort of item. Invite the guy or gal with the gift card to look around. However, as soon as you sense any sort of frustration, help the shopper funnel the alternatives. Absent this, the shopper’s too likely to leave your store without making a purchase. In addition, because of the feelings of frustration, he becomes at least a bit less likely to return to your store.
     One reason for the increase is gift card sales is retailer attention to personalization. Gift cards and holders can be customized with themes, such as sports and travel. At the time of redemption, notice the customization. Use that information to guide the shopper toward the right items. Never miss an opportunity like this to learn more about your customer.

Click below for more:
Reenergize Gift Card Sales

No comments:

Post a Comment