You've made the decision. It's time for your business to offer gift cards. Congratulations - I wholeheartedly agree. But the decision to stock this popular gift product may be the easy part. Now it's time to choose a supplier, your cards and merchandising materials. You remember now why you put this decision off for so long - there is much to consider. By focusing on a few important variables, you'll be more likely to choose the right partner to help create the most effective gift/loyalty card marketing program for your business.
Where Do I Begin?
Great question. Chances are you've already received calls from Independent Sales Organization (ISO) reps who offer a variety of services you need - credit card and check acceptance, transaction processing equipment (terminals), payroll services and even gift cards. You may have received responses from gift card companies after requesting a call by virtue of an online lead form. You've heard the pitches - but how do you choose the right gift card company for you?
Begin with a few simple queries for your ISO or gift card seller. If you are talking with an ISO, figure out which of the gift card suppliers they represent and learn a little more about them. Some suppliers focus solely on gift card programs and, therefore, may be more experienced to help their clients/businesses in finding the perfect program for their needs and purposes. Other companies may offer gift cards in addition to a host of financial services.
Find out whether they are using their own processing system and platform or if they are using something from a third party. What is their stated uptime? (This is a key factor since transactions won't occur if the system goes down. The last thing you want is to be unable to process a customer's gift card order due to a technical issue.) Find out if they have quality customer service in place. A few questions for this: Do they offer support via email? Toll-free help via phone? If a problem arises, do they have full-time 24/7 service coverage?
Now you will want to compare the differing plans available to you. Plans are usually divided into flat-fee billing or per-transaction billing. With per transaction billing, businesses are charged according to various activities. Small fees may be billed for card activating, card redemption, when value is added or when balance inquiries are made. With flat-fee payment plans, businesses purchase a block of transactions that combine all the various types of card activities. To determine the best option for your company, you will have to make some estimates as to how much sales and activity you will generate. A good gift card supplier should be able to help you though this process.
When your gift card program is up and running, you will want to know how successful it's doing. Your gift card supplier will provide you with various activity reports. Try to get an idea about what types of reports are available and how easily accessed they will be. The more reports that will be offered to you, the more you will be able to track results. At first, some of it may seem complicated when you begin, but you will quickly develop an understanding for some of these. The more reports you have available, the more sophisticated that understanding can be.
What about the Equipment?
Equipment and point-of-sale (POS) system compatibility should also be considered before settling on a gift card supplier. Gift card platforms are software applications that are downloaded into a merchant's credit card processing terminal or integrated into the merchant's POS system. Various gift card companies' applications are certified on specific terminals and POS systems. This should be one of the first questions you ask - will this company's gift card processing application work in my terminal environment? Is it integrated into my POS system? Look for companies with higher numbers of compatible terminal and POS systems - chances are they have more equipment experience and partner relationships. This is a sign of market strength and legitimacy.
The Right Cards
The first decision about card design is whether you want a custom card or if a standard card will do. Gift card companies will often have a set of standard card designs that appeal to a specific category or market and even some targeted for specific holidays. The benefit with these is that you can quickly offer your customers a semi-personalized card (business name, text and possibly a logo). While these don't have a full-custom design, you can be offering your customers appealing gift cards within a week. So, take a look at those standardized card designs and find a company that offers an appealing solution. A more advanced gift card supplier will take it a step further. They may have online tools that allow you to select not only different designs, but sample different colors and fonts to make the entire personalization process available to you before you commit to the program.
If speed to market isn't quite as vital, you may wish to look into a full-custom card. Although the expense may be higher and turnaround a little slower, you will have the advantage of completely controlling your branding and image. You can develop a card design that fits with the personality of your business and coordinates with your marketing plans. Some card suppliers will even have designers available who can put together the type of card you desire at a worthwhile price. Ask about the design-approval process, whether it can be handled rapidly and is web or email-based.
A Few More Questions Worth Asking
Part of any successful gift card program is merchandising. How your cards are presented at the place of purchase can greatly impact sales. Check your gift card supplier's offerings in the area of merchandising products - card hangers and carriers, envelopes, display racks and customer awareness products like posters and signs. Some companies offer products that merchants can sell along with their cards to increase their revenue potential such as gift card presentation products.
A great final question is "How does this company communicate with merchants?" Most major gift card companies offer newsletters and email notifications designed to make the merchant more effective and notify them about new products and services. The gift and loyalty marketing business is dynamic and growing. It pays to partner with a company that will keep you informed of industry trends and tips to increase your sales.
You've made a good decision to pursue a gift card program. Once you hook up with a gift card company, it can be tricky to convert your program to a new one later. So, do a little research, ask the right questions and you should be able to find the right gift card supplier to meet your business's needs.
About the Author:
Al Duggan is an expert in developing a gift card program and is the VP of Business Development for Valutec Card Solutions, LLC, a Metavante (NYSE:MV) company, the country's largest provider of plastic gift cards to small to mid-sized businesses.
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