Gift and Loyalty Cards
As we see with large corporate chains, gift and loyalty cards
are commonly used as presents for Christmas, birthdays,
graduations, or on many other special occasions. However, small
companies nowadays can also take advantage of this efficient
form of advertising.
Gift Card
Gift cards are usually placed on the counter. When your customer
buys a gift card from your company, he/she gives you the money
and you hand them a card with value in it. This card is usually
given as a gift to a third party who will eventually return to
your store to spend the value stored in the card. Some of the
benefits of gift cards are:
Merchant Benefits
• Cash flow is increased by collecting payment prior to
delivery of product or services
• Cards continually build brand awareness and customer
loyalty as “billboards” in the wallet—establishes current
customers as the destination of the ad
• Declining balance ensures full cash value of gift card is
used in store
• Customers spend more with plastic—average sale increase is
by 20% to 50%
• Easy to activate and use by both the merchant and consumer
• Can be used to handle merchandise returns for store
credit—keeps cash in store
• A low-cost turnkey service previously available only to
large retailers
• A powerful marketing tool for a wide variety of
promotional campaigns
• Management reporting provides monitoring and security
control
Consumer benefits
• Provides a personal gift without the giver having to
select a specific item
• Identifies the cardholder as a valued customer
• Easy to buy and easy to redeem
Loyalty Cards
Loyalty cards work similarly to Gift Cards. However, loyalty
cards are used to keep regular customers. For instance, a coffee
shop may offer a free coffee every time a customer buys five of
the same. A spa may give points for every dollar spent and offer
a discount for every number of points collected. Loyalty cards
make your customer more “loyal” to your company, so they are
more likely to return and recommend your products/services to
others.
The advantages are:
• Attracts and retains customers through loyalty, reward,
and incentive programs—cards can keep track of loyalty
points earned and can be reloaded for discount incentives
• An ongoing source of loyalty, rewards, discounts and
incentives for the consumer
• Identifies the cardholder as a valued customer
