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Maximizing Gift Card Campaigns

By Heyward Whetsell

Is your restaurant capitalizing on its gift card program for the holidays? Restaurant gift cards are the most popular type of gift card that consumers will be shopping for online this holiday season - the single most important time of the year for gift card sales in the industry. In order to get impactful mileage out of gift card programs, restaurateurs are turning to new technologies and implementing creative campaigns that will not only drive sales during this period but also offer the most return once the holiday season has passed.

Most restaurants offer guests the opportunity to purchase gift cards both on location and online. Until recently, customers who visited a restaurant's site only had one option - purchase a standard, plastic gift card in a pre-set denomination and have it mailed to the recipient. However, sending a gift card via "snail mail" is not the best option with today's shoppers spending more time online and having increasingly interactive experiences with e-retailers. Recently, one of my clients, CashStar, introduced gift cards that can be purchased online at a restaurant's website. These can be customized with a photo and/or message, be produced in any denomination and can be emailed instantly to the recipient or sent along at a date specified in the future. Virtual gift cards also cost less than plastic ones because there are no shipping costs.

These virtual gift cards are quickly becoming more popular among online consumers. In fact, during the 2008 holiday season, Uno Chicago Grill became the first casual dining chain to offer virtual gift cards. Uno Chicago Grill more than doubled gift card sales through its website during the last two weeks of that December by offering their customers the ability to email gift cards.

Virtual gift cards not only provide a new level of convenience for your customers, but unlike their plastic predecessors, they are also a trackable tool for restaurant marketers. This opens up an untapped world of possibilities for restaurant owners to take their gift card and marketing programs to the next level. Here are a few simple tips for cashing in on your gift card program this holiday season:

Drive Sales Online and On-site
The best way to give your gift card sales a boost is to promote them both online and in-store. Most restaurants have an e-mail club, and this is a great place to turn when marketing your gift cards. This group of brand supporters already interacts with your restaurant online and is a good target for click throughs to your gift card page. Also, review your current marketing 'real estate' for places to promote your online gift cards - banners on your homepage, buttons on your staff's shirts, table cards and menu inserts. Online gift cards are a natural fit for social media promotions on tools like Facebook, Twitter and other interactive communities. The holiday season is an opportunity to promote your cards via these channels and build customer loyalty.

Virtual gift card programs should be launched just like new menu items - feature them prominently to inform customers of this new offering. In your promotional efforts, remember that gift cards are usually a last minute purchase just before a major holiday. When gift card givers ship plastic cards via snail mail or even express mail, they run the risk of having that present arrive after the occasion. Restaurants can capture incremental sales for last minute gifts with a virtual gift card's ability to be sent and received within a matter of minutes.

Play up Personalization
Seventy percent of consumers recently said that the ability to send a personalized gift card with unique designs, photos and a message is important to them. Give your customers the option to choose from a wide variety of gift card face plates, let them upload special images and let them write a personal note or a poem. Don't miss potential sales because you're only offering one standard gift card option. Expand your gifting options, stand out from your competition and watch your customer base grow.

Drive Incremental Sales and as an Incentive
A whopping eighty-eight percent of consumers recently conveyed that they would be more likely to purchase an online gift card if they were given an incentive such as, "Purchase a $50 gift card and get a $10 gift card for yourself." These "give one-get one" promotions are becoming more popular with restaurant customers because it gives extra motivation for the sender. More importantly, for restaurant marketers, this tool drives two groups into your establishment - both the purchaser and recipient. A virtual gift card program can also map back to other sales and marketing goals such as increasing the e-mail club's membership or driving customers to dine at the restaurant a certain number of times in order to earn a virtual gift card.

The Analytics Advantage
A huge benefit of a virtual gift card program to the restaurant is that spending behavior for both the gift sender and recipient is can now be tracked, enabling restaurants to create tailor-made promotions for each customer. This is especially valuable considering that eighty-five percent of virtual gift cards are redeemed within the first three months and consumers typically spend more than sixty percent of the card's face value. Online virtual gift card campaigns produce deep customer data that, when analyzed, will help restaurants generate better-targeted promotions and turn gift card redeemers into long term customers.

Virtual gift cards open a several new potential avenues for your restaurant's online marketing and loyalty programs. Not only do they allow you to stand apart from your competitors, but they also provide restaurant marketers with more information about their customers so that future campaigns can be created specifically to sell more gift cards and fill seats in your establishment. With the holiday shopping season upon us, is your restaurant cashing in on the virtual gift card trend?

*Source: Holiday e-Gifting Survey, October 2009

Heyward Whetsell is the president of Heyward Whetsell Associates, a marketing consulting firm specializing in the restaurant industry. An industry veteran, Whetsell has headed marketing for leading casual dining, QSR and family dining restaurant chains. He works with clients that offer breakthrough solutions for restaurants, including CashStar, which launched its virtual gift card in December, 2008.

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