Analyzing The Benefits Of Giving Gift Cards Away

\"GiftIt’s the middle of summer. Christmas is many months away. But that doesn’t mean that gift cards aren’t still flying off the shelves of stores all over Canada. Of course, the holiday season is the time of year when gifts of all kinds are purchased in greater numbers. But there are reasons to give gifts all year round, isn’t there? Birthdays, anniversaries, house warmings, baby births and so many other occasions are all worth celebrating.

And, quite obviously, gift cards can come in quite handy as gifts for any of these occasions. Throughout this week, the Canadian POS Corporation Blog has been focused on the popularity of gift cards. Our posts have helped to prove that they make ideal gifts for all members of society for a number of reasons. Are you selling gift cards in your store? According to Brad Tuttle of, gift cards provide benefits to store owners even when they’re not being sold!

How is that possible, you ask? Tuttle notes that giving away gift cards is a “smart move for retailers and restaurants”. He writes that some retailers – Walmart, for example – put refund credits on gift cards instead of returning cash to their customers. That way, they ensure that the money being returned will actually be spent in their stores. As far as Tuttle sees it, this is a practice that other businesses should follow.

“It’s less painful—and more lucrative in both the short- and long-term—for businesses to give away gift cards rather than offer a cash discount or cold hard cash back,” he writes. He goes on to describe the benefits that come with guaranteeing return visits through the practice of handing out gift cards to customers. By providing gift cards over cash as forms of refunds for merchandise, you ensure greater interest in your store.

Tuttle cites IKEA as an example of a brand who has taken advantage of this fact. Years ago, the furniture giant introduced a promotion that involved giving customers 15% back from their sofa purchases. Instead of providing cash on the spot, the discount was placed on gift cards. Tuttle writes that such a discount is not generally available on the spot, so it encourages the customer to return to the store to buy something else.

“That alone is a win: repeat business,” Tuttle insists, “More bodies in the store, more eyeballs on the merchandise, more chances to connect to people with money to spend. Increasingly, retailers are shaping promotions to ensure customers come back, rather than simply attempting to draw them in for one-time sales. When customers show up with gift cards in hand, they’re very likely to spend much more than merely the gift card balance.”

Tuttle also points out that such a promotion encourages further spending. Most bonus gift card promotions, like the one described above, involve small values. As a result, “it’s nearly impossible for the shopper to avoid spending out of pocket.” If you’re looking to encourage repeat business and additional spending in your store – and what business owner isn’t? – giving away gift cards is an ideal solution!

To order gift cards to sell in your store, call Canadian POS Corporation at 1-877-748-2884 or email us at info@localhost.

Scroll to Top