Gift cards have always been a great way to bring new shoppers into your store – but during the COVID-19 crisis, they have become an important way for customers to show their support.  Buying a gift card today is in essence providing a small loan to a favorite small businesses, payable at a later date in merchandise or food.  The fact is that a significant percentage of gift cards are not redeemed under normal circumstances – but there are undoubtedly some customers who will buy them during this challenging time without having the intention of ever using them.  It’s a way of saying “I Love You” to small businesses suffering from the forced closure.

Many stores are already set up to sell gift cards online, but those that do not normally sell through their website can set up one of the special COVID-19 digital gift card programs offered through Square, Kabbage or Shopify.  It is important that you use a system offering a secure shopping cart so that customers can give their credit card information with confidence.

Once you are ready to offer gift cards, the best way to promote them during the time your shop is closed is through your social media channels and permission-based email blasts.  Our online system sends us a message whenever a gift card order is placed, and I always respond right away with a personal email saying that we look forward to the day when we are able to reopen so that they can come use the card in our store.

The widespread closure of stores around the country has led to some creative promotions of gift cards as a way of supporting locally-owned businesses.  Here in Madison, WI, Metcalfe’s grocery store is doing a program called Neighbors Helping Neighbors.  For a two-week period, Metcalfe’s is selling preloaded (or paper) $25 gift cards to local restaurants, sweetening the deal with a coupon worth $20 off a $100 grocery purchase for every one sold (up to 4).  It’s a generous offer that the shops in our business district hope to take advantage of during the next two-week period.  Stores that don’t have a plastic or printed gift card can create a paper one on their computer, adding a numeric code and an authorized signature for security. 

Some businesses are offering a bonus gift card with every purchase, for example an extra $20 card (sometimes with an expiration date) for every $100 card sold.  Others make a point of mentioning that the sale of gift cards will go to pay rent, or to continue benefits for employees who are out of work. Business shopping districts such Naperville, Illinois are offering bonus downtown cards with the purchase of cards for individual business as an incentive to encourage customers to support their favorite local businesses.

Becky Tyre of the Retail Details podcast shared the success story of Mackenzi Farquer, who owns five locations of the Lockwood Shops in New York’s Astoria, Queens and Brooklyn neighborhoods.  Mackenzi immediately started selling gift cards when she closed her stores due to Covid-19.  With a gift card of $50 or more, the purchaser gets a hand-written thank you note from someone on her staff (helping to keep some of her staff employed). In addition, the customer buying the card gets a VIP card for 10% off at any of the Lockwood Shops once they stores reopen, valid for the remainder of 2020.  You can read about this program on the Lockwood Facebook page.

Buying a gift card not only helps provide a cash infusion when it is most needed, but it also sends the important message that the purchaser has faith that the business will indeed reopen.  This expression of hope is very welcome as we all face the uncertain future.

Happy Retailing, 

Carol “Orange” Schroeder