One of the most frequent questions we get is: "How can I use gift & loyalty to increase my bottom line?"
It's a great question and one that we have some answers for. After 20+ years of dealing with the point of sale industry we have had customers use
gift & loyalty systems in many different ways.
Let's start with what a card like this does. In most cases, these cards are used for:
The customer purchases the card and give it away to someone else.
The customer loads and reloads the card for their own use.
You offer a point or punch reward program for your customer. The card tracks their points.
The card tracks purchases your customers make and allows your staff to easily duplicate previous orders.
So how can this help make you more money? Remember that one of the best features of a free gift and loyalty system is that it helps reduce credit card
transactions. Let's look at some ideas our customers have shared with us!
Free drink with gift card purchase
One of the easiest and best ways to increase prepaid usage by your customers. Offer a discounted
drink if the customer purchases a gift card of X value. Usually, this works as a 10% discount. For example, if your average drink price is $3.50, offer that drink
free if they buy a $35.00 card. One of the keys to this is to train your staff to offer this to anyone that DOES NOT pay with a prepaid card. In other words, really
target your credit card and cash customers.
Offer a VIP discount for paying with a gift card.
This will help encourage gift card usage. It does not need to be a big item, sometimes
something small is good enough. For example, if your customer pays with the card this week, they get an extra shot of espresso for free (this also gets them used to an
extra shot of espresso!). Even better, offer a small treat that varies from week to week. This keeps the system exciting for your customers.
Pay $50 get $55
Simple, if you buy a $50 card, you get a $55 on it. Customers love this as they are getting more value with the card purchase.
This can be a big one for your staff. This is a simple promotion that you can run all the time or just certain times of the year.
Pay $50 get a second card for $5
This is a variation of the suggestion above
Allow your customer to purchase a $50 card and offer them a second card for $5. This works really well
during the holidays. In some cases the customer will give the high dollar card to an adult relative or friend and
the lower value card to a younger relative or friend. Everyone likes taking care of two gifts at once!
One more variation of the above. Go big! If you are in an area with an affluent
demographic, offer a big gift card and gift card discount. For example, $250 for $200. This really depends on your customer
base but it can be a fun offering.
Use it as an employee card
This is an off the wall idea that some of our customers implement.
Instead of offering your employees a discount or free drink, load a specific dollar amount every month on their gift card.
The thought is that your employees use that to purchase drinks. If you have issues with employees giving away drinks to
friends or family, this can really help. Let them buy a friend a drink with their employee gift card. That allows them to "hook a friend up"
and still not get in trouble! This can actually help you reduce theft by employees.
Buy 10 get 1 free
This is a pretty traditional loyalty method. The customer receives a free drink after
10 drink purchases. This is very easy to explain to customers. Variations on this allow for double punch Tuesday or similar
incentives. Be aware that some customers are going to purchase 10 small drinks in hopes of getting that 20oz quad shot mocha for free!
Every dollar spent is a point
This is what Starbucks has moved to recently. It's a little more complex
to explain to customers but does offer more flexibility. Instead of rewarding customers based on number of visits, you base it on the dollar
amount that they spent. For example, after they spend $35 they have enough points to purchase a drink (up to $3.50) for free.
This can also allow you to open the reward to other items. Don't hesitate to have bagels or sandwiches count for points as well.
Percentage cash back
This is a newer method of rewards that we have seen. This works by providing a percentage
cash back whenever they use their rewards card in a transaction. This keeps the customers gift card with a constant balance as they are always
adding money through their reward tickets. Another note on this is that the customer is never really receiving a FREE drink. They are always
paying for it with their gift card balance.
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