We get asked a lot about the Pros & Cons of Gift & Loyalty. Here are some thoughts based on what we have seen from customers:
Credit Card Company
3rd Party Gift Card
Touch Screen on Counter
And then we come to the POS side of things. Want to know more about how we can help with that? Visit http://www.selbysoft.com/Gift-and-Loyalty-ideas-for-coffee.html
.A great Point of Sale system is one of the most important pieces of equipment you will buy for your location. Think about this – Almost zero national chains skip POS when opening a new location. Starbucks, Peets, Caribou, and more all have point of sale systems in their stores.
Why? I can tell you it’s not because they just enjoy spending money! It’s because they see the proven value of a good POS system when opening a coffee shop.
Look at some of the points that POS can help with:
Labor – keeping your labor costs under control is one of the biggest ways to save money. SP-1 for Coffee with help you stop early clock-ins. An extra 10 minutes at $10 an hour is $1.66 a shift. Multiple that by a couple shifts a week per employee and you could be paying $1,500 – $3,000 a year in extra wages. Take a deeper look and see how labor costs can be adjusted by viewing your on the fly labor percent.
Zero Training – SP-1 will make taking orders in your coffee shop easy. This is a bit harder to quantify but easy means less mistakes. Because the point of sale has all the prices set, employees simply make less errors. This helps you and the customer. Remember consistency is important in your pricing. If 10% of your orders are off by $.50, that is a huge amount a year. Easy means
Gift & Loyalty – This is the number one way to help increase customer retention. Gift and prepaid cards help bring cash in the door and increase average dollar per ticket totals. Customer reward programs are proven to be effective when handled right. We have seen customers use the gift & loyalty program to reduce credit card charges as well as decrease the speed of service.
Look & Feel – A cash register is not cool. Customers don’t trust them and they make your shop look inefficient and not quirky. There are all different types of equipment available for you to use. Wall mount options as well as counter options are available.
SP-1 has a very powerful gift and rewards program that is 100% free. I thought I’d be fun to cover the three different options we have for rewards in the system.
1) Buy 10 get 1 free. There are a number of variations on this but the basic premise is that a customer gets one free drink for every ten they buy.
Pros: The great thing about this is that it is simple and easy to explain. Your customers will feel that they are getting something free. The theory is that customers keep coming back as they have that next reward to look forward to.
Cons? It’s only really available in one category. Also, it encourages customers to buy cheap drinks and then ask for a more expensive drink as their free one. That can actually be a pro however. We have customers that encourage the free drink to be something the customer does not normally try.
2) Points. This is a variation on the above. Instead of earning rewards based on the quantity of drinks purchased, it is based on the dollar amount purchased. Usually one point equals one dollar. For example – 35 points is a $3.50 drink.
Pros: It stops the guys from buying $2.00 drip and then getting a $5.00 mocha. Also, you can have up to five levels of redemption. For example, 35 points is $3.50 off. $50 points is $3.50 drink and a muffin and so on. Finally, you can use this on more than one category. This is a more flexible version of the above.
Cons: It’s difficult to explain quickly to customers.
3) Percent Back. This is a completely different thought. Instead of points or punches, customers earn a percentage back on each purchase. Usually 5%-10%. This cash back goes on the customer gift card for their next purchase.
Pros: It’s free money to the customer. They can spend it whenever and however they like. This also keeps the customer thinking they have cash on their card. It’s pretty easy to explain as well. From a psychology standpoint, the customer is never getting a free drink. They are always purchasing it with their gift card money. This means you are rarely devaluing your product. Finally, you can easily change the percentage or end the reward at any time because the customer automatically has their money. With the other two methods it can be hard to end the program because the customers perceive that they are losing points or punches.
Cons: They are never really seeing the “free” aspect of the reward.
There you go! Give us a call and see it in action.
Want to increase your return on investment? Make sure you use the tools that SP-1 by SelbySoft has available for you.
We all want to be that company that knows our customers by heart. Unfortunately, sometimes it can be difficult to remember everything about everyone! If you are using our built in gift and loyalty system, you can get SP-1 by SelbySoft to help you!
It starts with the gift card because that gives you a reasonable reason to ask for a customers name, address, phone, email or anything else you want to track. Not interested in the marketing features? Not a problem, simply collect only the customers name. Once you have this, you can assign their gift card to their name in SP-1.
In SP-1, you can now simply type the customers name or swipe their gift card and SP-1 will pull up their last order. Along with the order, you will have buttons to duplicate their last order and even custom notes about that customer! This makes it very easy for your employees to comment on the last order the customer had.
With all the talk of the cloud in today’s POS market, you might wonder if anything isn’t in the cloud today! At SelbySoft, we try to offer the best of both worlds when it comes to the cloud.
SelbySoft prefers to have your data held locally in your store(s) location. Not on a rented Amazon server like most cloud based POS systems. This leaves you in control of your POS data and eliminates the possibility of being held hostage by a bad internet connection. Your SP-1 system will continue to work without any internet connectivity at all.
Cloud Based Features
So, how do you comp the card? The best way is to setup a discount that works for the gift cards only. The example below is of one that is a flat $5.00 discount. Notice that we have a price table of $5.00 making this a set discount. You could also add a security level so only managers / owners have access to this. When a gift card is sold and this discount applied it will discount that gift card by a flat $5.00. It does not matter if it is applied to a new or existing card.
Now the next example is an open discount: Notice that the price table is blank. This means that the employee can enter any amount they want for the discount! Pretty dangerous if you don’t have a security level on this! However, there is another way to make this type of discount easy to use – Enter an amount in the Max Discount Amt field. When a dollar amount is entered here, it sets a MAXIMUM amount that the employee can discount. For example, the price is blank and an employee goes to give a $20 gift card away- the system will tell them that it is limited to $5.00 and will not allow it.
This can also be a great way to help empower employees to correct mistakes, yet still track what is going on and eliminate abuses.