When in doubt, buy a gift card. It’s a safe and convenient gift-giving option, with 32% of consumers purchasing seven or more a year. Gift cards foster brand loyalty and attract new customers. However, they also pose a formidable challenge: the accumulation of outstanding, unused balances.
Enter the concept of gift card redemption campaigns, a strategy designed to motivate customers to redeem their gift cards and alleviate the financial and inventory pressures unused gift cards place on businesses.
Gift cards are a valuable asset in eCommerce. From a revenue perspective, they provide up-front capital, often leading to overspending when the card is redeemed. In terms of customer loyalty, they encourage repeat business and provide an opportunity to gain new customers.
However, the accumulation of unused gift cards causes issues. These cards represent debt — merchandise or services the company owes. This can become problematic if many cards are redeemed at once, which could disrupt inventory management and overall business operations.
Gift card redemption campaigns remove the risk and worry associated with these potential challenges. When meticulously planned and effectively executed, these campaigns offer several benefits, such as:
These insights can then tailor your future marketing efforts and product offerings more effectively.
First-party customer data is key to eCommerce success. Check out MyFBAPrep’s guide to Understanding the Importance of Customer Data.
Planning a successful gift card redemption campaign is a meticulous process. Here’s a step-by-step guide to help you cover all bases.
What do you aim to achieve through your campaign? This could be reducing the number of outstanding gift cards, increasing sales, driving customer engagement, or acquiring new customers.
Defining clear objectives serves as the foundation for your campaign and guides all subsequent decisions.
Based on historical sales data and market trends, determine when your customers are most active and likely to redeem their gift cards. This could be during a holiday season, annual sales events, or specific days of the week.
Timing your campaign with these periods can boost its success.
Next, consider the various elements that’ll shape your campaign, including:
A successful campaign requires the right tools and resources.
You might need a customer relationship management (CRM) system to manage customer data and personalize communications, email marketing software to distribute campaign messages, and social media management tools to track and schedule promotions. Ensure you have the appropriate tools in place before launching your campaign.
Before you kick off the campaign, have a plan to monitor its performance and make necessary adjustments. Define key performance indicators (KPIs) that align with your campaign objectives and decide how often you’ll review these. Also, plan for different scenarios and how you’ll adjust your campaign strategy in response to these.
Planning a gift card redemption campaign can be a significant undertaking, but following these steps will ensure your campaign is well structured, strategically targeted, and primed for success.
Once you’ve planned the details of your gift card redemption campaign, the next step is to set the wheels in motion and execute it.
The success of your campaign relies heavily on how well you launch it and your ability to adapt and modify the campaign based on its performance.
Promotion is the lifeblood of your campaign. It’s essential to communicate effectively with your target audience through the right channels, including:
Incentives are a driving force that motivate your customers to redeem their gift cards. The right incentives can increase the success rate of your campaign significantly. Consider employing:
It’s essential to monitor the performance of your campaign continually. Regular tracking allows you to understand if the campaign is effective or if there are aspects that need tweaking. Some valuable KPIs to monitor are:
If the campaign fails to meet its objectives, or if there’s an opportunity to enhance its results, you can and should make necessary adjustments. This might include modifying the incentives, changing the promotional message, or using different channels.
The key to a successful campaign is to remain flexible and adaptable to changing dynamics and customer responses.
One effective way to encourage gift card redemptions is by offering fast or free shipping for this action. As online shoppers increasingly value quick and free shipping, this is a solid incentive to motivate customers to redeem their gift cards.
MyFBAPrep offers this and other services that can significantly strengthen your gift card redemption campaigns. With our robust inventory management and fulfillment solutions, you can maintain diverse and plentiful inventory to provide your customers with ample choices and increase the chances of them redeeming their gift cards. Once they commit to purchasing with their gift card, let our team handle the order fulfillment, be it picking and packing or speedy delivery — and everything in between. Your buyers will enjoy a first-rate shopping experience from start to finish, and you take on none of the burden.
Gift card redemption campaigns are essential for eCommerce retailers to manage their financial obligations for outstanding gift cards and gain more control over their inventory.
By following the steps outlined in this guide, you can design, implement, and manage a campaign that secures more gift card purchases. Remember, the right tools and strategic partnerships play a crucial role in the success of your campaign, so analyze your needs and research your options before committing.
Start planning your redemption campaign today and take control of your outstanding gift cards to improve your sales and strengthen your customer relationships.