Gift Certificate Systems
December 11, 2009 by Jonathan Munsell
Filed under Low Cost No Cost Restaurant Marketing, Restaurant Marketing, Restaurant Marketing - Online, Restaurant Marketing Tools, Restaurant Promotion
The Gift – Savvy Merchant
A Must for Independent Retailers, Restaurateurs and Service Establishments
By John S. Harris
This is a guest post by John Harris (this is the fourth of a 4 part series)
Gift Systems. It’s a brave new world out there as far as online gift certificate services are concerned. Your most successful competitors are already there. If you’re not, it’s never too late. Most of the systems today can be up and running in literally one or two days. I put this table together to try and simplify a pretty complicated industry. There are billion-dollar vendors and tiny start-ups in this space, and hundreds of companies. So this is merely my attempt to clarify what’s out there.
The Landscape of Online Gift Certificate Services Available to Small Businesses
|
Traditional Certificates |
Magstripe Cards |
“Virtual” Certificates |
|
| Medium | Paper or Card Stock | Plastic | Email, or Mobile Token |
| Easy to sell in-store | Yes | Yes | Not Yet |
| Easy to sell online | Yes | Yes | Yes |
| Time to get up & running | 1 -2 days | 1 – 3 weeks | Varies |
| POS integration | No | Yes | Varies |
| Security level | Low | High | Medium |
| Setup Costs | Low | High | Medium |
| Loyalty-use option | No | Yes | Varies |
| Monthly Fees | Offline=No
Online=Yes |
Offline=Yes |
Online=Varies |
| Transaction Fees | Offline=No
Online=Varies |
Offline=Yes
Online=Yes |
Online=Yes |
| Pros | Very low cost, can now be easily put online, little to no transaction costs, very easy to implement, many consumers like the physicality, usually specific to one merchant | Medium cost with any volume, very secure, real-time, can integrate to POS, can be used as Loyalty card, convenient, quality format | Instant delivery, more consumer personalization options, is a true “green” alternative, a very popular option with consumers, mobile option is exciting |
| Cons | Not as secure, not integrated with POS, printing and fulfilling is no fun, still need quality design work, no online redemption | Getting set up is typically hundreds of dollars, and POS integration adds both initial and ongoing costs | Email isn’t a very elegant gift format, redemption integration not a picnic, adds transaction costs |
|
Sample Vendors (with URL) |
|||
|
PLEASE NOTE:
This is by no means intended to be a definitive list. There are many vendors in some of these categories and you should search on your own for all options. Listing a company here is not an endorsement, and no representation is made as to performance or reliability. |
GiftLinx.com puts links on the merchant’s website and handles the actual online ordering, printing and mailing to the merchant’s clients, a labor-saver | FirstData.com has a deep, regulated list of quality magstripe system and services resellers | GiftTango.com provides both Email and Mobile forms of their virtual gift certificates. They can be customized for any merchant. |
| GiftCertsOnline.com also puts a link on the merchant’s website, and provides the online ordering engine and an option to print certificates online, but does not do fulfillment. | Swipeit.com serves the small business market directly, covers setup, system and fulfillment | GiftCertificates.com has long enabled its certificates to be provided in email form, with many discounting options | |
| TheGiftCardCafe.com puts a link on the merchant’s website and handles the online ordering. They do not do fulfillment, but offer an “Instant” eGift via email | ProfitPointInc.com provides a wide array of gift, loyalty, credit and related card marketing and operations services | Cashstar.com offers virtual gift certificates in Email form, with many customization features for consumers. Online or in-store Redemption. | |
About The Author – John S. Harris has been a small business consultant for over twenty years. A former owner and operator himself, John is a principal in Lynch + Harris, a consulting firm specializing in operations management and marketing communications that helps independent restaurants and retailers expand their business and improve their operations. John can be reached at ircharris@gmail.com
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