Digital Gift Cards, Plastic Gift Cards and Loyalty Programs for High Risk Merchants

With the rise of digital gift cards The North American market for gift cards is growing a lot. It’s expected to reach a huge $168 billion in 2024. Loyalty programs are also moving to digital formats, giving customers more personalized experiences. 

For high-risk merchants, plastic, digital gift cards, as well as loyalty programs have been important tools for growing their businesses and keeping up with the competition while meeting the changing needs of today’s shoppers.

Let’s explore briefly what gift cards and loyalty programs are, how high risk merchants can benefit from them, and what Electronic Transfer Inc. can do for you.

What Is a Digital Gift Card?

A digital gift card is like an electronic voucher that you can buy and send to someone as a gift. Instead of a physical card, it’s all done online.

How Do Digital Gift Cards Work?

Clients can purchase digital gift cards online from your store or various affiliated stores. After making the payment, the clients typically receive an email containing a code or link to access the gift card.

When they want to use the digital gift card, they have to enter the code or show the email at checkout. Technology plays a role in tracking the balance and ensuring security.

How to Use a Digital Gift Card?

A digital gift card can be used online or in physical stores:

• Online stores: When making purchases on the internet, your clients can input the gift card code at the checkout. 
• Physical stores: At brick-and-mortar stores, your clients can present the digital gift card email or code to the cashier. The cashier will then handle it as they would with a traditional gift card.

Why Should a High-Risk Merchant Offer Digital Gift Cards?

Offering digital gift cards can be a strategic move for high-risk merchants. Here’s why it’s beneficial: 

• Digital gift cards can lead to higher sales, often resulting in additional spending beyond the card’s value, boosting revenue.
• They have the potential to attract new customers who may not have otherwise considered shopping with the merchant, expanding the shop’s customer base.
• By offering cards, merchants can incentivize repeat business, fostering loyalty among customers and encouraging them to return for future purchases.

Here are a few tips for high-risk merchants:

1. Ensure gift cards are sold through secure servers and promote robust password practices among customers to enhance security.
2. Implement advanced fraud detection software to monitor transactions closely and prevent fraudulent activities.
3. Educate customers on secure redemption practices so that they can protect themselves against fraud.
4. Restrict the number of gift cards that can be purchased simultaneously to deter fraud.
5. Require authentication for all account activities, especially during gift card activations and redemptions, to add an extra layer of security.

Plastic Gift Cards

Even with the popularity of digital options increasing, plastic gift cards are still relevant Moreover, they serve as a tangible symbol of a brand, playing a vital role in retaining customers and building brand loyalty.

The Opportunity with Electronic Transfer Inc.

By participating in Signature’s gift/loyalty card program, we enable you to take advantage of the great benefits:

• Enhanced cash flow: The value of the cards remains inactive until activation, and their nature makes counterfeiting challenging.
• Higher consumer spending: Customers frequently exceed the initial value of gift cards.
• Cost-effective marketing: Utilizing promotional gift cards as a marketing strategy is more cost-efficient than purchasing advertising space, offering a significant return on investment.
• High demand: Gift cards are generally a sought-after item, and most programs meet customer demand.
• Increased store visits: Gift card holders tend to make multiple visits, boosting store traffic.
• Streamlined accounting: Eliminates the need for complex “backroom” accounting processes.

What Are Loyalty Programs and Why They Matter? 

Loyalty programs reward loyal customers with points, prizes, and/or discounts to people who are subscribed to the loyalty program. 

The main benefits of having a loyalty program are: 

1. It keeps customers coming back and spending more: People like getting rewards for shopping. They also tend to spend more money over time.
2. Builds better relationships: Giving personalized rewards makes your clients feel closer to the brand.
3. Sets your brand apart: Having a unique loyalty program makes a brand stand out from competitors.

High-risk merchants can establish thriving loyalty programs. Here are a few tips if you consider opening one:

• The rewards should be tailored toward the customers.
• Customer data can help you enhance the program.
• Ensuring seamless integration with existing systems.

Wrap Up

By incorporating plastic or digital gift cards as well as a loyalty program, high-risk businesses can cultivate their relationship with their customers, drive sales, and nurture brand loyalty.  Loyalty programs can help pave the way to success.. 

Electronic Transfer Inc. can assist you in this process! Contact us today and we’ll be happy to help.