3 Ways You Can Use Holiday Gift Cards To Boost Brand Awareness and Customer Retention

Editor’s Note: This article is a guest contribution from Neomi Avron, marketing manager at Rise.ai, the gift card and store credit solution for online brads.

Almost every brand you can think of offers a gift card, so it’s no surprise that they’re one of the most popular products in the world.

People usually think about gift cards as a gift option for close friends or for last-minute needs. But they can be so much more. 

If you don’t already have one, it’s time to create a full gift card program for your brand to take advantage of the holiday gifting season. 

Gift cards aren’t just for large brands. They can be both a brand awareness and a customer retention tool for brands of all sizes and from different industries.

A gift card is a great way to help your customers introduce new people to your brand. When someone receives your gift card, they then have an incentive to visit your website or your store to learn about your products and your brand. 

And it doesn’t have to be difficult to get started with gift cards. 

An easy way to get started with gift cards

This holiday season, encourage your customers to send an e-gift card to a friend or family member. This can help you expose your brand to new potential consumers and increase your customer base. 

When thinking about how to design your e-gift cards, ensure the design aligns with your brand style and tone. 

For example, Milk Bar, the New York sweets bakery, is a great example of a brand that creates a fully on-brand experience and offers multiple design options for your gift card.

On the other end of the spectrum, SKIMS, Kim Kardashian’s shapewear brand, offers only one gift card design but it highlights the brand well. From the colors to the image on the gift card, it has a clean, classy look that’s on-brand and conveys clearly to the recipient what the brand offers.

 

The SpongeBob Shop, the online shop for the popular Nickelodeon TV show, uses a different approach. Not only do they brand their gift card, but they offer a different design for each variant.

La Colombe, the ready-to-drink coffee beverage shop, highlights the experience and the power of gifting, and how the product will look once you use your gift card to buy the coffee of your choice.

Using gift cards to acquire new customers is only half of the story, though. You can also use gift cards as a customer retention tool. 

3 tips to help you develop or enhance your gift card program

Whether you’re just getting started with a gift card program or you’ve already put one in place and you want to enhance it, here are some helpful tips.

1 | If you’re just getting started with gift cards

In a year like 2020, where social distancing has become the norm, many people won’t be able to celebrate holidays, birthdays, or other life events with their families as they would normally. This is one of the top reasons gift card sales will be extremely popular this year, and you can use this purchase intent to your brand’s advantage.

For example, you can offer an extra incentive on your gift cards with a “pay $100, get $120” promotion. This will motivate potential customers to choose gift cards not only as a gift for others, but also for themselves. 

You could also run a buy one, get one (BOGO) gift card campaign. Using those promotions you will be able to retain your customers and give them a good reason to shop at your store again.

Girlfriend Collective, the sustainable activewear brand, offered a 20 percent discount on gift cards. Recipients could use the gift card on any product the brand offers. During the 30 days that they ran this promotion, 20 percent of all store orders included a gift card.

2 | If you’re ready to boost your gift card program

The ecommerce industry bloomed over the last year as consumers moved the bulk of their shopping online during the pandemic. But with the convenience of having products delivered to your door and the ability to easily return them, many brands may see a spike in the number of returns and refunds they have to grant once the holiday gifting season is over. 

To help you retain customers who may not have received the perfect present, you can incorporate a gift card refund into your returns policy and allow returners to get a gift card they can redeem at their convenience. This strategy can help you reduce the cost of refunds.   

In a nutshell, store credit refunds are not only effective to reduce operations costs. They’re also a great way to increase brand loyalty. When issuing store credit, you provide a substantial reason for your customers to come back and give your brand a second chance. 

Dottie Couture, a women’s fashion boutique, took this approach when dealing with returns. Dottie’s official policy is to only offer store credit for returns and refunds. From February through April 2020, Dottie issued more than 10,000 store credit refunds. With a redemption rate of 40 percent and an upsell rate of more than 300 percent upsell on the credit, it’s clear to say this approach paid off.

3 | If you’re ready to take your gift card program to the next level

Now more than ever, consumers want to feel connected to the brands they buy from. Once you establish a connection with your customer, you can be sure they’ll return to shop again at your brand. 

Establishing your own branded currency enables your customers to use it as real cash, and helps you create an advanced emotional connection with your shoppers. Make your currency a part of every purchase, reward your customers with it, and promote it on your website.

Vici Dolls, another women’s clothing boutique, noticed a drop in sales every weekend during 2018. They established their Vici Bucks program, which featured a flash sale every weekend that enabled shoppers to earn store credit they could use on their next purchase. 

It helped Vici kill two birds with one stone—increase weekend sales and encourage customer loyalty and repurchase with a future reward for every order placed during the weekend.

Vici Dolls was able to change their customers’ behavior, increase weekend sales, and establish a strong connection with a 62 percent redemption rate on the rewards.

Key takeaway

Gift cards are great and that’s why everybody uses them. But many brands overlook the greater potential that gift cards hold. By creating a full gift card program that focuses not only on customer acquisition but also on customer retention, you’ll be able to increase your return customer rate.

The path to a successful 2021 goes through the 2020 holiday season. A good gift card experience that keeps in mind the different stages of the customer journey will help you transform holiday one-time shoppers into loyal customers and brand advocates.

Looking for more Cyber Weekend inspiration and ideas? Find out how one brand is tackling their email marketing campaign.

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