The success of an enterprise is heavily dependent on how well the product and services have been marketed. Now, we all know about the stiff competition that goes on out there for enterprises to grab the ‘numero uno’ position. And so, it is very obvious that organizations have to come up with diverse and novel marketing strategies to be top notch. Gift cards is one such marketing strategy that contributes significantly in setting up a strong customer base and also in the increasing sales figure.
What Is A Business Gift Card?
Do you have a card from a departmental store that looks somewhat similar to a credit card and provides you with an alternative to pay for your purchase using that instead of paying with direct cash? Well, that is a gift card. Enterprises often provide their customers with a gift card for a certain amount of money which can be used for payment on later occasions.
The concept of gift cards has been quite popular as a marketing strategy ever since its inception as it allows enterprises to build an appreciable customer base which in turn contributes to the sales figure. How does it happen? Well, let us talk about the naming of the card first. Why is it called a gift card? It was primarily used as a gift by customers for their kith and kin. In this way, the products and services of the organization gets known about and used widely, thereby, effectively increasing the number of customers.
Gift Card as a Marketing Strategy
What is the basic objective of marketing? The obvious answer is to create brand awareness. Marketing ensures that maximum number of people come to know about the product and services offered by your enterprise, thereby drawing potential customers to it and increasing the sales figure. Needless to say, your enterprise will have to come up with certain strategies to meet this end. And gift card is one such strategy. There are a number of benefits of the gift card.
- It has already been stated that gift cards were/ are meant as gifts by customers. Now, if we follow things a bit logically, then it becomes obvious that the person who is making use of the gift card has already used the brand and so in a way of recommending is gifting the gift card to people he/ she knows. And the result? Increased customer traffic, of course.
- Secondly, issuing a gift card means that your enterprise does not have to actually offer the products and services at that point of time. But you have the good money in your hand. It is similar to the working of a credit card but in the other way round. Surveys show that around 15% of the gift cards do not come back to claim the services or products and with the money being non-refundable, your enterprise is ensured of quite an increase in the profit margin.
- Customers tend to spend more than the value of their gift cards. Making purchases with gift cards is not an exact science. People don’t tend to spend the exact value of the cards. By the time the value has been used up in full, a customer has most likely spent more than the value of the card. That means more money for you! “61 percent of gift card holders spend more than the amount of their gift card, with 75 percent of those individuals spending more than 60 percent over original card value”.
The use of gift cards means that you can easily market your brand with zero investment. Come to think of it and you will realize that you are actually getting paid for promising to provide the product and services at a later date. Gift cards, thus, are certainly one of the most pragmatic means of creating brand awareness.
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