Gift Cards Guarantee Greater Sales

In our last blog, we discussed the growing popularity of the sale of gift cards by retailers all over Canada. It doesn’t matter if it’s the holiday season or not, gift cards are continually proving themselves to be great gifts – for both shoppers and merchants alike. For shoppers, they provide great convenience. They are automatic roadways to getting gifts people actually like.

Most people feel compelled to return gifts that they wouldn’t buy for themselves. It’s just an age-old part of the entire gift-giving and receiving experience. But gift cards help to eliminate that. People get to buy exactly what they want after getting gift cards as presents. The benefit to business owners, of course, is that gift cards guarantee future sales.

Especially after the holidays when business slows down, gift cards are bound to bring new customers into your stores. And, as we mentioned last blog, shoppers with gift cards tend to spend more than the denominations on the cards. After all, they are only really paying the overage, so it’s generally no big deal to them. But spending in excess of the gift card amount is clearly a big deal to your business.

A CBC News report revealed that “on March 21, 2006, Statistics Canada reported that gift cards helped propel January 2006 retail sales to a record $31.8 billion — up 1.4 per cent from the normally frantic holiday shopping season in December. The reason? Retailers don\’t record a gift card purchase as a sale until it is redeemed for merchandise.” Gift cards clearly help those sales to keep coming.

Gift cards also present greater benefits to business owners than gift certificates. And you may be wondering what the difference is. As CBC points out, a shopper can redeem a gift certificate for an amount less than what the certificate is worth. The retailer, of course, is required to provide change. With a gift card, the unspent amount of money left after the transaction remains on the card.

That means that the leftover funds will be spent in the same store on a future date. Gift cards, as you can see, guarantee merchants that the money is spent with their businesses. They essentially become promises that customers will return to the stores the cards were purchased from in order to do their shopping. Every time you sell a gift card, you are practically ensuring a return visit.

As explained by the CBC News report, “Pick up a pair of $45 pants with your $50 jean store gift certificate and you can go down the street and buy lunch at the doughnut shop with your change. Not so with a gift card. Buy something for $45 with the $50 gift card and you have $5 left on the card to spend at the same store next time you\’re there.” Pretty cool, right?

Is your business selling gift cards yet? Getting your company set up to sell gift cards is a lot easier than you may think. At Canadian POS Corporation, we make it a point to ensure that each and every one of clients get access to selling gift cards through a quick and easy process. Speak to one of our representatives today. Simply give us a call at 1-877-748-2884.