5 Ways Gift Card Marketing Can Fuel Your MLM’s Growth
Back in 1994, Blockbuster invented the modern-day gift card. Then, Starbucks took gift card marketing to the next level by selling cards that could be re-loaded after the original value was spent. And the rest is history. Today, Starbucks estimates it sells around 1,700 gift cards per minute, and 76 percent of shoppers buy at least one gift card during the holiday gift-giving season.
So, how did gift cards become such an integral part of retail sales? Of course, they’re convenient for shoppers to buy and easy for recipients to redeem. But the real reasons for gift card popularity are found in the value provided to retailers who issue them. For Multi-level Marketing (MLM) businesses, gift card marketing drives awareness, growth, and loyalty in five strategic ways.
1. Build brand awareness.
Branded gift cards are like tiny billboard advertisements for your business. Whether it’s an introduction to a new customer or a treat for a longtime buyer, a gift card marketing strategy can increase your visibility, bring new first-time customers to you, and prompt people to make a purchase. A bump in brand awareness pays off. Eighty-two percent of consumers say they favor brands they recognize when shopping.
2. Expand your customer base.
Most gift card sales create at least two customer experiences – one for the person who purchases the gift card, and a second for the person who receives it. Gift cards not only give your customers a way to recommend your products to family and friends, but also to facilitate a first purchase. This makes gift cards more powerful than word-of-mouth endorsements, with existing customers essentially paying you money to give you new customers. The introductions are worthwhile. Research shows that at least 10 percent of recipients are unfamiliar with a business before receiving its gift card.
3. Increase average purchase amounts.
One of the best qualities of a gift card shopper is that they’re less price sensitive. Because it’s a gift, recipients see a gift card as “free money,” and they’re willing to spend more than the value of the card. In addition, one in three shoppers say they’re more likely to buy a full-price item when they’re purchasing with a gift card.
The value of gift card marketing adds up. Seventy-two percent of gift card shoppers spend more than the gift card amount, and they’re likely to do so over multiple shopping experiences. Plus, the customer who buys a gift card for someone else spends an average of 38 percent more themselves!
4. Collect valuable data.
Gift card marketing is an ideal opportunity to expand your customer data. By capturing the demographics and product preferences of new customers, you gain insights to help guide your business decisions, fine-tune product offerings, and target marketing efforts. In addition, you can also track the relationship between the gift card purchaser and the recipient, which can personalize future customer interactions. Businesses that are able to leverage this type of customer intel outperform their peers by 85 percent in sales growth.
5. Create customer loyalty.
Gift card marketing can be a cornerstone of a customer loyalty program by incenting customer return visits or rewarding shopping behaviors. Building gift cards into your loyalty program as customers achieve defined purchase milestones is a win-win. Your customers gain a treat for themselves, and your business wins because your loyal customers will likely spend more than the value of the card. The reward amount doesn’t have to be big. Awarding a $5 or $10 gift card for a large purchase is a way to thank a customer and give her an extra reason to shop again soon.
Another effective gift card marketing tactic is to award the cards as a surprise. Unexpected rewards create a memorable, positive experience that exceeds expectations, inspires increased loyalty, and gives customers a story to tell others.
Are you making the most out of gift card marketing? Wayroo can help. With Wayroo, you can sell branded gift cards and easily integrate the strategy within our well-organized CRM through loyalty and rewards programs that help drive participation, boost loyalty, and increase sales. Contact us for a demo today.