Are people finished buying plastic gift cards?

Are plastic gift and loyalty cards going to go the way of th dodo?  Like phone cards, cassette tapes, and the under-appreciated laser disc?  Long story short, no.

For those who don’t know me, plastic cards are my business. prints millions of gift and loyalty cards every year.  And this year demand from our POS partners has actually increased significantly.

We’re selling more gift cards now, than we ever have.  People aren’t showing any signs of slowing down.  If anything, people are giving more gift cards as gifts each holiday season.

But how does that help the retailer?

Gift and loyalty cards should be a cornerstone of your sales strategy.  When I was in retail, we always looked at what our “profit centers,” were.  If you’re a gas station, you sell fuel, food & beverage, and misc. other stuff.  Each is a profit center.  Customer gift and loyalty cards are a profit center all to themselves.

But how do they work?

Each one has it’s own job.

Gift Cards

Gift cards get your clients in the door.  Most of your customers receiving gift cards for the holidays haven’t been to your store.  They’re being given the gift by someone who’s making a recommendation.  Someone who’s saying “You’ve never been here, but I’m betting $X that you’ll like it.”

Gift card buyers are the best kind of buyers too, because it’s not their money they spend.  So they spend it like kids in a candy store.  Most often, they’ll spend more than the gift card is worth too!  Since they treat it like found money, if they find a $140 item they want, they’ll buy it even if they only have a $100 card.  Because in their eyes, it really only cost $40!

And the better time you show these customers, the more likely they are to keep coming back.  And as we all know, it’s cheaper to keep customers, than it is to find new ones.

Loyalty Cards / Rewards Cards

Loyalty and rewards cards are the other side of the coin.  It’s Loyalty cards keep people coming back.  They offer an incentive for your customer to come visit you, rather than shopping at Walmart.

The cards work with your POS system to collect points, or discounts for repeat customers.  And believe me, it works.

Super America doesn’t offer a loyalty/rewards program for no reason.  And do you think Target wouldn’t offer it’s 5% off discount with it’s “REDcard” if it wasn’t making money?  These are a few examples of national retailers who make big money using loyalty.

With the right loyalty program, you can do a lot.  If your store sells clothing. you could give double loyalty points to people who buy winter clothes in March.  That helps you get rid of overstock, and gives the discounts to your most loyal customers.

Or imagine you’re a restaurant.  You look over receipts and notice that Wednesdays are traditionally slow.  Offering free pie to loyalty/rewards customers could bring in some extra bodies.

Wrap up

No matter how you look at it, bringing more people in to your business will increase sales.  So will hanging on to customers.  Gift and loyalty cards are inexpensive ways to do exactly that.

If you have any questions about customer loyalty, give me a shout anytime!  You can reach me by email here.  Or on Linkedin here!  And read some of my other stuff about gift and loyalty cards here.

Cole Goebel
Cole Goebel is a POS Industry insider. He's an expert in encoding and barcode data, and has a great knowledge of POS integrations. Cole currently works at Plastic Printers in Minnesota, where he's the Channel Manager. He works directly with POS providers to deliver gift, and loyalty cards to their clients.

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