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How to Increase Gift Card Sales
Gift cards and gift certificates are valuable low-hanging fruit for any consumer. When set up correctly and targeted to the right customer, they practically do the work for you. Something as simple as physical or eGift gift cards can ramp up sales and ultimately add a nice boost to your bottom line.
That’s because there’s a huge market for gift cards. According to a recent report, the gift card market in Canada was worth $5764.6 million in 2020, and expected to keep growing to reach $8368.4 by 2025.
Read on for tips to run a successful gift card program that helps attract and keep new customers, while feeling right for your business.
How to set up gift cards for your business
With Square’s gift card program, you can work with predesigned templates or create your own custom look – for digital or physical gift cards. There’s no subscription payment or redemption fee for cards, and they cost as little as one dollar per card, depending on your order.
Once your gift card program is up and running, you’ll receive transfers for gift card activations in as soon as one to two business days.
How to build and run a successful gift card program
To successfully sell gift cards, you’ll need a strong strategy. Here’s a step-by-step guide to setting up your own gift card program:
1. Determine your target customer. Will your gift card program be more attractive to returning or new customers? You can use your Square Dashboard to:
- Create business reports.
- Review spending habits.
- Get transaction insights to best utilize gift cards depending on who’s shopping, how, and when.
2. Set some goals. Look to your Square Analytics to determine estimated quarterly sales for your business. Use this information to then come up with a goal for your gift card sales.
3. Decide where to sell your gift cards. Are you going to sell physical gift cards in your store, eGift cards online, or both? Considering the POS for gift cards is vital. Placement of physical cards is important to the consumer, so adapt your store setup. Signs and a location next to the register, close to where customers make a payment, might help you maximize gift card sales.
If you’re selling online, make sure you create a gift card section in the main navigation on your site. The more visible your gift cards, the better positioned your gift card program should be for success.
4. Select when to stock up on gift cards. Typically, a large percentage of gift cards are sold in the fourth quarter during the holidays. Plan accordingly when deciding how many cards to purchase and scale up the quantity of cards on offer for the last three months of the year. You can order more Square gift cards anytime.
5. Work out your inventory. After you’ve done your homework and have a solid idea of estimated sales for the year, it’s time to figure out how many gift cards to purchase. Do you want to start small and place additional orders throughout the year on an as-needed basis? Or do you want to go big and bank on strong gift card sales? Square provides three options for ordering:
- Starter packs require a minimum purchase of 20 cards (at $2 per card) and offers four card themes from which to choose.
- Quick card packs require a minimum purchase of 75 cards (at $0.95 to $1.20 per card) and applies your business name to a background template card.
- Custom card packs require a minimum order of 75 cards (at $0.80 to $1.75 per card) and allow you to upload your own art to fully customize your business’s gift cards.
6. Manage your inventory. Throughout the year, keep close track of how many gift cards you sell in relation to how many you purchased, so you can place orders for additional cards before you run out. You never want to risk turning a customer away because you goofed on supply.
Gift cards are integrated right into your register and Dashboard – you can sell, redeem, track, and reload with no additional tools. Plus, gift cards show up in all your reporting. You can even export a full report of gift card sales right from your POS Square Dashboard.
Additionally, think about the price points of the gift cards you’re offering (such as $5, $25, and $50) and the merchandise that your business sells for those amounts. Use Square’s inventory management tools to track stock quantities and sign up for email alerts when items start to run low, so you never run out of those gift-card-worthy items.
7. Have an accounting strategy. Now you’ve determined how much of your budget to spend on gift cards, keep an eye on your progress by staying on top of sales and continuing to manage your budget using Square’s business analytics tools. Through Square Analytics, you can see how much you sold this week, last week, last month, and even six months ago. The reports may help you figure out why sales might be up or down.
8. Monitor customer behavior. Remove the guesswork around selling by getting to know your customers better. Assess private feedback that customers give through digital receipts and crunch digestible data from the Square Dashboard to easily understand your numbers and consumers.
Meanwhile, Square Analytics shows you consumer behaviors and patterns — how much customers spend and how often they return — arming you with the details to make the best decisions for your gift card program. And Square’s free Dashboard app means you can do all this wherever you are.
