Gift cards (and gift certificates) are extremely important for generating revenue, yet few salons and spas focus on this aspect of their business. A recent study shows that almost 70 percent of beauty related businesses are selling an incredibly low number of gift cards/certificates, between 0-50 each quarter! This blog addresses why gift cards are so important and how you can sell more this year.
3 Reasons Gift Cards Are Important
1. Sales, Sales, Sales!
The most important (and obvious) reason gift cards are important is because they lock in future sales. Without a cash refund option, your gift card sales automatically result in an uptick of service and retail sales and help you better predict your business growth.
2. Increased Customer Spending
The majority of customers who redeem gift cards spend more than the card’s value. Whether it’s because people who receive gift cards view them as “free money” (making them lax about how they spend it) or simply because they believe leaving a small balance on the gift card is wasteful, studies show that gift card users consistently spend more than the balance of the card, which can be a boon to your bottom line.
Gift cards are free marketing. A gift card has your logo and contact information on it, a perpetual advertisement right in the customer’s pocket. It also adds value to your brand when your services are given as gifts among family and friends.
4 Ways To Sell More Gift Cards
Whether you sell gift cards online or have a stand near the front desk, your customer’s need to know your gift cards are available and easy to buy. For example, your front desk staff should include the question “would you be interested in a gift card today?” as part of the checkout process. Your gift cards should be readily available at the front desk. Also, you should have a system in place to make their sale quick and easy.
2. Offer Gift Cards Instead
There are many “think-outside-the-box” ways to increase your gift card volume and reap the benefits of gift card spending. For example, offering customers a free $10 gift card with the purchase of a $100 service is a great way to rid your business of discontinued coupons and temporary discounts. Another creative way to move more gift cards is to offer them in place of refunds or returns, which also gives you the opportunity to get a customer to come back even if their original experience wasn’t perfect.
3. Rent a Kiosk
Many of the most successful salons and spas rent out kiosks or booth space at local malls, farmers markets or other gathering spaces with potential customers as opposed to waiting for them to walk through their door. This puts you in front of a larger and more diverse audience where you can be proactive instead of reactive!
4. Be Philanthropic
Donating gift cards to a local charity or fundraiser is a great way to get exposure while also letting people know your business cares about the community. By donating gift cards, you also have the opportunity to gain repeat customers and grow your regular clientele!
About the Author
Matt is VP of Sales at ProSolutions Software. With over 20 years experience in the beauty industry, Matt teaches classes to salon and spa owners on business topics including branding, management, marketing and advertising.