Ten Things You May Not Know About Gift Cards
When is the last time someone gave you a paper gift certificate? Probably a very long time ago! There are lots of good reasons for this. Gift cards are increasing in popularity because they have lots of benefits for merchants as well as recipients. Though cards are sold in the retail environment, they are also a frequent component in corporate incentive programs. A study from Comdata showed some interesting and useful trends.
- Gift Cards increase revenue - they generate 2 to 10 times more sales than paper certificate programs.
- Purchases made with a gift card are 20-50% higher than the average ticket.
- 53% of card users often or always spend more than the amount originally loaded onto their cards.
- The majority of consumers redeem the entire value of a card, rather than leaving a few pennies.
- 50% of consumers in the study redeemed the entire value of the card in one visit, while those who take multiple visits will visit the retailer 3.5 times.
- They are also most likely to redeem their cards over multiple visits, increasing store traffic and the potential for sales over the value of the card.
- Gift givers tend to spend more when they purchase a gift card than they would on an alternative gift.
- 4 out of 5 people prefer to receive a gift card from a favorite store, rather than a gift chosen for them by the giver.
- Recipients add their own money to the final purchase, upping the original amount by almost 20%.
- Two gift card recipients in ten have become loyal to merchants they had not previously patronized as a result of receiving a gift card.
If you'd like to reap the benefits of gift cards in your marketing, contact us at APTCO for more information.
Reduced Advertising During Recession Negatively Impacts Consumer Perception
More than 48% of U.S. adults believe that a lack of advertising by a retail store, bank or auto dealership during a recession indicates the business must be struggling. Likewise, a vast majority perceives businesses that continue to advertise as being competitive or committed to doing business.
The latest Ad-ology Research study, “Advertising’s Impact in a Soft Economy,” analyzes consumer perception about businesses that continue to advertise, and those that do not, in the current economy.
The study finds advertising appears to play a key role in consumers’ view of how a business is doing, and by not advertising, businesses may be sending a warning signal to current and potential customers.
“It is critical to advertise in the current economic climate, to maintain long-term positive consumer perception of your brand,” said C. Lee Smith, president and CEO of Ad-ology Research. “Advertising not only assures consumers of a business’ reliability in a soft economy, but it can influence where and what they buy, especially when the ads address concerns about value,” Smith said.
When asked what they thought upon seeing that an auto dealer had reduced advertising, 50% thought they must be struggling, while only 8% thought they must be doing well. While this study was done earlier this year, before the worst of the worst news came out about America's “Big 3”, the lesson is an important one for the surviving independent dealers. They might also consider that their traditional advertising venues - TV, radio, and newspapers - are, by far, the most expensive. Promotional products, on the other hand, offer the lowest cost per impression. With tight budgets during recessionary times, that becomes more important than ever.