Q & A with John Harms: Increasing Revenue with Gift Cards

Dear John,

With Valentine’s Day right around the corner, I’m looking for ways to leverage this gift-giving holiday in my salon. Do you have any tips on ways to boost sales not just now, but year-round?

Yes! Selling and promoting gift cards are sure-fire ways to bring in more revenue. According to a CEB TowerGroup Report, gift card sales are expected to hit $140 billion this year. It makes sense since gift cards are the perfect go-to, nothing-could-go-wrong kind of gift. Especially when you think about men who are looking for Valentine’s gift ideas for their significant other, they are a perfect market for salon or spa gift cards. However, even though Valentine’s Day is the perfect occasion to get your gift card strategy started, this does not mean you should stop promoting gift cards when Valentine’s Day is over. It’s in your best interest to give gift cards your attention all year long. In fact, 61% of gift cardholders spend more than the amount of their gift card, so it’s a good idea to always promote your gift cards. On top of increasing revenue, a good gift card strategy can also encourage return visits and bring new clients in the door.

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Here are some ways to promote gift cards that will help maximize revenue:

1. Create your gift card promotions

Take a moment and really think about your gift card promotions. A good gift card strategy can have you bringing back not just one, but two people to your salon or spa. Some examples for promotions are:

  • Buy one, get one 50% off.
  • Buy a $25 gift card and receive a $5 gift card free.
  • Buy a $200 gift card and receive a $20 gift card free.
  • Spend $100 and get a $10 gift card.
  • Buy a product, get a $5 gift card.
  • With the purchase of a $200 gift card, receive a FREE gift set!
  • Partner with a charity and a portion of your gift card sales goes to the charity.

Like most promotions, the gift card should expire to give clients a sense of urgency to use them.

TIP:  Make sure you run a report in your salon or spa software that will show your remaining gift card liabilities that are about to expire. You can then reach out to these gift cardholders via email, phone or text, reminding them to redeem the gift card before it’s too late. Not only will this get the client back into your salon or spa, but it will also most likely exceed your customers’ expectations and make them remember why they love your business.

2. Create an email marketing campaign

If you have salon or spa software, you can easily aggregate a targeted list of clients and send them an email that showcases your gift card promotion. Here are some ideas for email marketing campaign segments. You can tailor each message to each market.

  • Target those who have purchased gift cards in the past.
  • Target specific groups for specific holidays.
    • Mother’s Day
    • Black Friday
    • Graduation time
    • Father’s Day
    • Valentine’s Day
    • Just because gifts
    • Last-minute gifts
    • Teacher appreciation

Make sure your email has a call-to-action button that sends the client to your site to finalize a purchase. Create a Marketing calendar (or download one we have created for free) and plot some dates down in advance that make sense for your gift card strategy. That way, you can set them all up and focus on other areas of your business.

3. Leverage your social media

Whether you are promoting gift cards as bridal gifts or for holidays, post your promotion to social media and include images. No matter the size of your following, run a special for your followers such as 10% off Mother’s Day gift cards. Even a small group of followers can have a high conversion rate if the promotion is enticing. If you want to reach a larger audience outside of your followers and take full advantage of posting on social, “boost” your post. This increases the reach and the chances of your promotion being seen. Some individuals who purchase a gift card may even share the deal with their friends and family.

4. Offer the ability to purchase e-gift cards on your website

Make sure you offer the ability to purchase e-gift cards right from your website. Your website will make your gift card offers available 24/7. That way, when someone is ready to purchase a gift card, they can easily do so on your site—

whether it’s 5AM or 11PM. Not to mention, the average amount loaded on a digital gift card is around 10-15% more than a plastic card! So make sure you have a clear “Get a gift card” call-to-action right on your site.

TIP: A good e-gift card portal should:

  • Customize your gift card page with your company branding.
  • Allow you to customize your own e-gift cards.
  • Allow the purchaser to write a custom message right on the gift card.
  • Offer the ability to add your custom promotions—like spend $200 and get 15% off.
  • Integrate with your business management software.

5. In-store promotions

Your customers won’t buy gift cards if they don’t know that they exist. Here are some ways you can make a splash in your salon or spa to increase awareness:

  • Point-of-sale display with the promotion.
  • In-store signage.
  • Checkout display of the actual gift cards—make sure these are attractive-looking cards. Many consumers base their purchase decision based off of what the cards look like.
  • Window signage.
  • Create team shirts that talk to the gift card promotion.
  • Create a culture where your staff talks about the gift card promotion.
  • On-hold messaging.
  • Host an event in your salon/spa for your top spenders where they can build custom baskets for gifts. Include a gift card with each basket.

These are great ways that your clients will have you top of mind when they are thinking about purchasing their next gift.

6. Out-of-store promotions

Out-of-store promotions are often overlooked, but can be a very effective way to build awareness. Some out-of-store promotion options include:

  • Radio.
  • Local newspaper.
  • Donating gift cards to be used as giveaways at local events.
  • Cross-marketing with a local jewelry store, a limo company, or an intimate restaurant or inn to include gift certificates to your spa as part of a beautiful holiday package. 

7. Evaluate your gift card strategy

Measuring success is the best way to make sure that you are on the right track with your gift card strategy. Creating a goal at the beginning of the year is a good way to start marching towards better understanding your gift card success. Here are some ways to measure success:

  • How much do gift cards account for in your company overall?
  • How much more did you sell this year vs. last year?
  • Gift card sales during holiday promotions.
  • Average dollar amount loaded onto gift cards.
  • Number of online gift card sales.

You can then use these numbers to drive your decision on where you can use some improvement. Make it a fun and exciting challenge for your entire team to work towards.

Remember, there is never a wrong reason to give the gift of a relaxing day at the salon or spa. With gift cards becoming one of the most popular gifts, your business should focus on promotion through e-mail marketing, social media efforts and in-store promotions. By putting these marketing strategies to work, your business will enjoy better profit margins and increased overall revenue.

John Harms
Millennium Systems International, Founder and CEO

About: John Harms, Founder & CEO of Millennium Systems International, creator of Millennium Software, has been designing industry leading salon scheduling software and educating the beauty & wellness industry since 1987. Today Millennium is utilized in thousands of businesses in over 38 countries and operating with approximately 150+ employees worldwide.  Millennium currently runs its corporate headquarters out of New Jersey and its international office is based in the U.K.

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