As the global economy seems to be on the verge of another recession, every business enterprise is trying desperately to hold onto its customers. The situation is only worsened by the increasing level of competition in the current market scenario. In such hard times, people have been forced to look for alternative ways of marketing and fortunately, they have come up with some very efficient ideas. Gift & loyalty card services is one of these ideas which has delivered excellent results in the near past.
How do Gift and Loyalty Card Services Work?
A lot of companies offer these services to promote sales and retain customers. Basically, they allot plastic cards to their customers which are swiped through an electronic machine every time a customer purchases something. A gift card allows a customer to make multiple purchases as it has a particular balance in terms of dollars. Every time an object is purchased, the amount is deducted when the card is swiped.
Loyalty cards also work in a similar fashion. Also known as club cards at times, they offer certain incentives to loyal customers. For example, if you have a loyalty card from a particular retail store, you might be entitled to additional discounts or other promotional offers. Some cards also have a point accumulation system and these points are later converted into dollars.
Benefits of Gift and Loyalty Cards
1. The most obvious advantage of these cards is effective customer retention. If you have a gift card or a loyalty card, you are bound to return to the same store or business enterprise as loyal customers. The cards act as tempting incentives, drawing customers to the store time and again.
2. These services can also be an excellent form of marketing strategy. The cards can be used for purposes of advertising as they are tiny symbols of the company itself. Every customer is carrying a company card right in his or her wallet- one couldn’t ask for a better way of promoting their company.
3. All business merchants and companies invest a lot of money in detailed customer analysis. The data needs to be gathered from a variety of sources and then, it is filtered according to different categories. The gift and loyalty cards issued by companies can be used to gather these valuable statistics. The entire system is automated and a card can instantly be traced back to its owner. Additionally, companies can also trace the spending pattern of individual customers and market themselves accordingly. This way, marketing can be customized and individualized according to the needs and desires of different customers.
Therefore, gift and loyalty cards clearly have their advantages. They serve multiple purposes, right from customer retention to developing marketing and advertising programs. On the flip side though, the initial developmental costs involved are pretty steep. A small business company might feel burdened by the cost of printing the cards and establishing the entire system. However, every company must seriously consider availing the benefits offered by these services.
Barry Asserson writes shopping tips for retailers and consumers, attempting to assist both in their pursuit of successful shopping. He has contributed pieces about the importance of loyalty programs and debit machines.