Guide for Restaurant Gift Cards – Do They Work + How to Get the Best Results

How many times have you dined out this week? Most people likely eat out a few times a week. There are several reasons why people enjoy dining out. It’s very convenient because you don’t have to cook or clean. It gives you a chance to relax and have someone serve you. Restaurants are also great for socializing with friends, family, and colleagues. They offer an opportunity to escape the busyness of everyday life and to enjoy unique food that you can’t get at home.

One more reason people dine out is because of restaurant gift cards. Many times, I’ve tried a restaurant simply because I received a gift card from a friend or family member. It’s hard to turn down a free meal! Gift cards are a powerful way to get people out of their homes and into a new restaurant. For this reason, gift cards are crucial for restaurants. Whether you run a large pizza chain or a small local restaurant, gift cards are essential for attracting new customers and retaining loyal ones. If you’re unsure how to get gift cards for your restaurant, don’t worry! Here we can help guide you through the process.

Gift cards play a crucial role in generating revenue for restaurants.

In 2020, the worldwide gift card market was valued at $295.2 billion, which is a substantial amount of money. So, how can your restaurant benefit from this? And how can you boost your gift card sales? We’ll explain how restaurant gift cards function, who purchases them, and the typical revenue generated by a restaurant gift card. Finally, we’ll provide some strategies for marketing your gift cards to enhance sales.

Restaurant Gift Cards: Do They Work?

Gift cards are highly popular holiday gifts in the United States, as per the National Retail Federation. They have been the top choice for consumers for 13 consecutive years.

Even in the restaurant industry, gift cards are favored as holiday presents. Restaurant gift card sales saw a 10.4% increase in 2018 compared to 2017, according to Paytronix’s Annual Gift Card Sales Report 2019.

Despite a slight decrease in the number and value of gift cards sold during the shorter holiday season last year, the long-term outlook for gift cards remains positive. The global gift card market is expected to grow at a CAGR of over 13% between 2019-2023, according to a recent Technavio report.

The rise in gift card demand is influenced by various factors such as the growing gifting culture, convenience of cashless transactions, and advanced payment solutions. Busy lifestyles, a preference for flexibility, advancing technology, and the widespread use of smartphones also contribute to this trend.

Consider these factors when providing restaurant gift cards:

1. Ensure easy discoverability: Customers should easily find where to purchase gift cards on your website or app.
2. Offer partial redemption: Allowing multiple uses of the card through partial redemption gives customers flexibility and encourages future visits.
3. Avoid restrictions: Gift cards without expiration dates or minimal restrictions are more appealing to customers.
4. Focus on design: Design your gift cards for brand recognition with a memorable design, including your logo and contact details for brand consistency.
5. Promote year-round: While December is a peak season for gift card sales, promoting them throughout the year can boost sales significantly.
6. Provide online and offline options: Offering mobile gift cards is crucial in today’s shopping landscape to reach a wider customer base.
7. Send regular reminders: Encourage customers to use their gift cards through newsletters, social media, and push notifications to increase redemption rates.

Ways to Boost Restaurant Profit with Gift Cards

6 Effective Strategies for Promoting Restaurant Gift Cards

To maximize the benefits of your restaurant gift card program, follow these key promotion strategies:

1. Provide discounts or bonuses: Offering a 10% discount for gift card purchases over $50 can entice customers to buy more gift cards.
2. Introduce limited-time or seasonal deals: Create urgency and drive impulse purchases by offering special deals like a free dessert with gift card purchases during the holiday season.
3. Collaborate with local businesses or influencers: Partnering with other businesses or influencers can expand your reach and attract new customers. Consider offering discounts for customers with gift cards from partner businesses.
4. Utilize social media and in-store promotions: Utilize platforms such as Facebook, Twitter, and Instagram to display your gift card promotions using attractive graphics and videos. Also, utilize in-store resources like table tents and posters to advertise gift cards.
5. Incorporate gift card promotions in email campaigns: Use email marketing to target specific audiences and promote your gift card options effectively.
6. Provide exclusive perks for gift card holders: Encourage customer loyalty by offering special discounts or VIP benefits for gift card holders, such as discounts on future visits or VIP seating arrangements.

Here are the reasons why your restaurant needs gift cards:

Attract New Customers: When customers buy your gift cards for others, they are essentially endorsing and recommending your restaurant to others, which can attract new customers who may not have otherwise visited your business.

Encourage Repeat Visits: Offering gift cards to your existing customers can encourage them to return, and prompting them to reload their cards can help reduce the need to print new cards and promote repeat business.

Boost Sales: Gift cards can increase sales by expanding your customer base, and studies show that most gift card holders spend more than the card’s original value, often returning to spend any remaining balance in the future.

Branding: Gift cards serve as a marketing tool to keep your restaurant brand in your customers’ minds.

Addressing Dissatisfaction: Instead of providing refunds or free items, offering disgruntled customers a gift card can encourage them to give your restaurant another chance to impress them, and it shows that you care about their experience.

Immediate Cash Flow: During times of reduced sales, like the current crisis, restaurant gift cards can provide a quick cash influx to cover operating costs.

Here are some best practices for restaurant gift card sales and redemption:

1. Provide an easy and secure point-of-sale experience: Make sure that purchasing and redeeming gift cards at your restaurant is easy, secure, and hassle-free for customers. This will encourage them to buy and use gift cards in the future.
2. Implement a user-friendly online gift card system: A secure and user-friendly online gift card system can simplify the process of purchasing and redeeming gift cards. If customers have a positive experience with this system, they will be more likely to engage with your gift card program.
3. Train staff on gift card policies and procedures: It’s crucial to ensure that your staff is well-trained on gift card policies and procedures so they can effectively address customer questions about gift card sales and redemption.
4. Monitor gift card sales and redemption: Tracking gift card sales and redemption is essential for evaluating the success of your gift card program. Analyzing this data can help you make informed decisions about which promotions and strategies are effective and which ones may need adjustment.

Utilize your restaurant technology and POS system to boost gift card sales

By integrating Milagro’s comprehensive platform designed specifically for restaurants, establishments can significantly enhance their operations and customer engagement. Through this technology, restaurants can provide several benefits that not only improve the overall dining experience but also increase gift card sales.

Milagro’s all-in-one platform facilitates efficient online ordering and streamlines the implementation of loyalty programs. This not only boosts customer convenience but also encourages repeat business. Additionally, the platform enables restaurants to sell gift cards online, expanding their reach and making it convenient for customers to purchase and redeem gift cards.

Furthermore, by utilizing Milagro, restaurants can strengthen their brand by offering a seamless and technologically advanced experience to their customers. This not only enhances customer satisfaction but also creates a favorable impression, increasing the likelihood of customers purchasing and utilizing gift cards.

In summary, the integration of Milagro’s restaurant technology and POS system offers numerous advantages. From improving operational efficiency to enhancing customer experience and loyalty, restaurants can effectively increase their gift card sales and overall revenue through the utilization of this advanced platform.