Sunday, November 14, 2004
Tuesday, August 31, 2004
Retain Business With Gift and Loyalty Cards
Retain Business With Gift and Loyalty Cards: "According to Bain & Co., a consulting firm in Boston, gift card sales in 2002 were expected to total between $36 billion and $38 billion, up 20 percent from the preceding year. This mounting popularity is not surprising, considering the many benefits gift and loyalty cards hold for merchants and their customers.
Gift-givers with little time to shop, for example, regard the plastic cards as a practical, modern alternative to cumbersome paper gift certificates. Industry experts also believe more consumers are choosing gift cards as a result of stricter return policies, which deter shoppers from taking chances with their purchases.
The cards are gaining popularity with gift recipients as well. In a survey by research firm Synergistics Research Corp. in Atlanta, of 1,000 consumers, 64 percent said they found gift cards to be 'valuable,' with 48 percent describing them as 'very valuable.' And it's easy to see why. Not only are gift cards versatile and stylish, they are easy to carry, which increases the likelihood gift recipients will actually use them.
Merchants are quickly catching on to the merits of gift cards, which can dramatically boost sales, since shoppers usually spend more than their cards' initial value. When customers do leave unspent balances, the money is kept on their cards. Storeowners no longer have to offer cash refunds. This means shoppers must either return to use up their cards or write off any unspent amounts. Significantly, almost 14 percent of gift card recipients never use their cards' full value, and of those customers, 40 percent leave balances of more than $5, according to Synergistics. Although unused balances don't count toward sales, they do represent increased income to merchants.
Other advantages gift cards offer include convenience "