Why Your Small Business Should Offer Gift Cards This Holiday Season

The holiday season is quickly approaching, and small business owners are gearing up for the busiest and most profitable time of year. Alongside promotions, pop-up events, and seasonal offerings, one simple yet powerful tool can drive sales and customer loyalty: gift cards. 

Gift cards are more than a convenient holiday gift- they're a strategic way to boost revenue, attract new customers, and create brand loyalty. Here's why offering gift cards is a must for your small business this year. 

1. Instant Revenue Boost 
As a small business owner, the holiday season provides the opportunity to maximize revenue. Gift cards generate immediate cash flow because they're purchased up front, which can boost your bottom line, especially during peak holiday shopping times. 
For many small businesses, this increase in revenue helps with end-of-year financials, allowing you to restock inventory, pay for holiday expenses, or invest in marketing efforts. 

2. A Magnet For New Customers 
Gift cards are the perfect way to attract new customers. When someone purchases a gift card for a loved one, they invite that person to shop with your brand. These people may have never bought a product in-store, booked a service, or shopped online with your business before. This creates an opportunity to get your business in front of a wider audience. 
What starts as a one-time visit to your business, whether in person or online, can turn into repeat business and a life-long customer. 

3. Encourage Higher Spending 
A big advantage of offering gift cards is that customers who shop with them are more likely to spend more than the value of the gift card. Research shows that more than 60% of gift card users will spend 38% more than the amount that was gifted to them. Whether in-store or online, many shoppers use gift cards to justify splurging on additional products or services they might not have considered purchasing before. 

4. Reduce Refunds and Returns 
Holiday shoppers are often worried about purchasing the right gift, and as a small business owner, you likely don't want to deal with the hassle of handling returns and exchanges. Gift cards can help solve both problems! By giving the recipient the freedom to choose what they want, gift cards reduce the likelihood of returns because they will be satisfied with their purchase. 

5. Capitalize on Last-Minute Shoppers 
The holiday rush always includes last-minute shoppers scrambling to find the perfect gift for their loved ones. Offering gift cards is an excellent solution for them, especially if you provide digital gift cards that can be purchased and delivered immediately. This helps them buy a hassle-free yet thoughtful gift. 

6. Increase Brand Awareness and Loyalty 
Gift cards, especially branded ones, are another excellent marketing tool. They are a tiny billboard for your business and keep your brand in front of the minds of the gift giver and recipient. If paired with a good rewards program, they can also help increase customer loyalty. They also work great for promotions to reward your existing customers. For example, you could offer a gift card promotion where the purchaser gets an additional $10 gift card for every $100 gift card they purchase. 

7. Convenient and Flexible 
Gift cards provide flexibility for both the buyer and the recipient. Buyers will appreciate the convenience of purchasing something they know their loved one will enjoy without trying to find the perfect gift, and the recipient will enjoy the flexibility of picking out what they want. 
What better way to give than offering the gift of choice? 

Offering gift cards is a strategic decision for small business owners that can drive sales, build brand awareness, and attract new customers. Whether you offer physical or digital gift cards, this simple yet effective tool can help you maximize your holiday profits while providing a convenient gifting option for your customers.