A gift card is a gift card, right? Although it may seem like they are all created equal, that definitely is not the case. As you contemplate incorporating gift cards—otherwise known as stored value cards—into your business model, it’s smart to understand all your options.
The Private Label Card
When you think of gift cards, this is usually the type that jumps to mind. This kind of plastic only works in your store, no other. Customers use it as they would a Starbucks or Barnes & Noble card. You’ll need to adapt your POS system to accept and store value on these cards.
As long as your merchant service provider allows these cards, all you will pay is the cost of creating them. You will not need a credit card network to allow purchases made with these. Your POS system must allow you to activate, register, store value, pay for purchases and deal with loss or theft. The biggest advantage of store-only cards is that you have total control over how they are used and can sell them onsite or online.
The Private Network Card
Your second option may sound a lot like the first. After all, you can get this type of card set up to only accept transactions at your store, just like the option above. The difference is that this card uses standard credit card authorization systems, not your own POS, for all administrative tasks. If you already have a POS system, this card should seamlessly integrate with it.
Credit Card Network Gift Cards
Your third option is the same type of card that can be purchased at a bank. The customer’s spending limit is the amount of money he or she spent in purchasing the card. Many of these can also function as debit cards, and whatever POS terminal you utilize will accept them.
Don’t Forget: Optimize the Card to Attract Customers
No matter what type of card you choose, invest some time and capital in designing a card that reflects the products or ambiance of your business. If you do, customers will be much more motivated to buy cards for friends, family or business contacts. They might pick up one or two for themselves while they’re at it.
Think of your gift card as a small but powerful advertisement for your retail operation. View it as a promise of future visits. Finally, look forward to the opportunities it will give you to continue growing and enhancing your business.