We all want to make more money, right?

And we all want new customers in the door who are going to give us that money in exchange for our top-notch product or service, right?


Offering gift cards for your local designer boutique, personalized subscription service, or luxurious spa and salon is an essential step that you, as a business owner, need to take in order to get both customers and cash through the door.

1. Time

When a gifter purchases a gift card to your business, you receive that money no matter what. They might lose the gift card accidentally, store it in a “safe place” only to forget where that safe place is, or they may simply not remember they have the gift card at all.

In fact, $750 million in gift cards went unused in 2014. Yes, you read that correctly — that’s $750 million worth of product that you don’t have to deliver, and $750 million in your pocket. Well, sort of.

Or, if that customer does eventually come in to redeem their gift certificate — say, months after they received it — you would have had the time to use the cash you received from that sale to put toward paying employees, buying more product, or thinking about expanding into a new location.


2. Breakage

Let’s say you own a local boutique that offers high-end designer accessories straight from the pages of Vogue. It’s unlikely that you have product in store that’s worth less than $200 or so. That means, when a customer comes in with a $100 gift card to spend, it’s pretty much guaranteed that there will be overspend from that sale. Unless you offer tiny hand lotions in the checkout line or something. Dammit, Sephora.

And if you’re a local nail salon who offers gel manicures for $52, the likelihood that a gifter would purchase a $52 gift card is pretty unlikely. They would typically purchase a $60 or $75 gift card to cover the cost of the mani. The customer then comes in and redeems their $60 gift card for $52, leaving $8 still on the certificate. Therefore, if this customer is anything like us, they’ll forget about that $8 and you’ll get to keep it.


3. Advertising

Offering gift cards is also a great way to get your name out into the universe. Sure everyone knows there’s a Gap in the neighborhood, but you’re a local business, and newcomers to the ‘hood won’t know about you unless they happen to look up from their phone while walking down the street. And we all know that rarely happens

Here’s how it works: Let’s say your loyal customer, Kelly, comes into the store every couple of weeks to browse the new selection. Kelly happens to have a friend moving to the city, and that friend happens to have a birthday coming up. Kelly purchases a gift card to say “happy birthday and welcome to the neighborhood!” A few weeks later, Kelly’s friend comes into the store and voila! You just gained another customer.

Advertising also works to your advantage if you join a gift card marketplace (ahem). When a gifter from San Francisco is looking for a special gift for her sister who lives in Brooklyn, she’s going to type “gift cards NYC” into her browser to find the perfect place. She finds the online gift card marketplace, browses through the merchants, sees your fantastic selection of product (that happens to be right up her sister’s alley), and purchases a digital gift certificate. If you’re lucky, she’ll also hit up your ecommerce site and pick something out for herself.


4. Customer loyalty

More than gaining NEW customers, gift certificates can also help you retain EXISTING customers. As a business owner, you know it’s essential to build up your list of customer emails, and after 3 years in the biz, you have a list of about 5000. Some of those customers are Kellys — they’re always coming back for more. But other email addresses were collected from one-and-done customers who didn’t make their way through the customer loyalty cycle. And you didn’t sit through 9 a.m. Marketing 101 sophomore year to NOT have a customer go through the whole cycle.

So how do you get them back in the store? Send out promotional gift cards to your email list offering — for example — 20% off a gift card purchase of $100 or more. Who wouldn’t bite the bullet??



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