You've thought about it and realized that it is finally time to add gift cards to your business -- a smart decision. As you sit down to begin the search for a supplier, you quickly realize that there is a lot to consider. How do you go about making a choice that's the right fit for your business? With several areas to consider, it's best to break the decision-making process into a few, specific areas. Asking a few key questions can help you make the proper selection.
Where do I Start First?
Great question. Chances are you've already received calls from Independent Sales Organization (ISO) reps who offer a variety of services you need - credit card and check acceptance, transaction processing equipment (terminals), payroll services and even gift cards. You may have received responses from gift card companies after requesting a call by virtue of an online lead form. You've heard the pitches - but how do you choose the right gift card company for you?
Let's start with some simple questions. If you are speaking with an ISO, you should ask about which gift card suppliers they are representing. Some of these gift card companies offer a variety of different financial services to go along with the gift cards. Others are solely in business to service those who need to develop a gift card program. These suppliers will likely be better suited and more experienced to help craft a program that fits your needs.
Ask if your prospective supplier has their own proprietary processing platform vs. licensing their platform from a third party. Don't hesitate to ask about customer service. Do they offer 24/7 service coverage in case of a problem? Do they offer responsive email support? Is their phone support toll-free? What is a company's stated uptime? This is important because transactions don't take place when the system is down. You don't want the aggravation of telling a customer you can't handle their gift card purchase because of a technical problem.
You'll also want to take a look at the transaction processing programs offered by the companies you are evaluating. Many offer "flat-fee" programs that include all program activity for one monthly fee for a large block of transactions. Other programs may bill on a "per-transaction" basis where the monthly fees are reduced or eliminated and the merchant pays a small fee when a card is activated, value is added, it is redeemed, or when a customer checks a card balance. Often the best way to choose between these options is to estimate card sales and the resulting transaction activity and compare the costs of each plan.
How will you know how your program is doing? That is measured by activity reports supplied by your gift card company. Be sure to ask what reports are available and how they are accessed. Generally, the more reports available to you, the better. Although some may seem advanced when you're starting out, you'll soon get to the point where you'll want to dig deeper into the data.
How about the Equipment or Hardware?
Equipment and point-of-sale (POS) system compatibility should also be considered before settling on a gift card supplier. Gift card platforms are software applications that are downloaded into a merchant's credit card processing terminal or integrated into the merchant's POS system. Various gift card companies' applications are certified on specific terminals and POS systems. This should be one of the first questions you ask - will this company's gift card processing application work in my terminal environment? Is it integrated into my POS system? Look for companies with higher numbers of compatible terminal and POS systems - chances are they have more equipment experience and partner relationships. This is a sign of market strength and legitimacy.
It May Be in the Cards
Now comes the emotional part - choosing your card. You have a number of choices here but the first decision you'll need to make is "standard or custom?" Standard cards are designed by the gift card company and are often available for specific markets and targeted holiday buying events. The advantage to standard cards is speed-to-market. Since the cards are already designed and printed, they can be personalized for your business by adding your business name and other text (some companies can even print your logo on standard cards) and you can be selling gift cards within a week. The key is to choose a gift card company that offers a standard card design that appeals to you. Larger companies offer tools on their websites that let merchants not only check out their standard card designs, but try out different typestyles and colors for the personalization on their chosen design before they commit to a card.
The other option is the custom card. While these may be a bit more pricey and have a longer turnaround time, the result is a gift card that captures your brand, image and personality. These can coordinate your marketing efforts and branding. Some questions here to ask relate to the scope of the card supplier's design abilities. Some suppliers can offer a design staff to create your card design for a manageable fee. Find out whether they offer web or email proofing to make design approval as rapid as possible.
Digging Further With a Few More Questions
Rather than stop with card design, find out what additional merchandising tools are available. Some card suppliers will have an array of card carriers and hangers, display racks, posters, signage and envelopes that will help you drive awareness and sales. Presentation at the place or point of purchase can dramatically boost card sales...and profit for you. Some suppliers can also provide you with various gift card presentation products that you can sell along with your gift cards.
A great final question is "How does this company communicate with merchants?" Most major gift card companies offer newsletters and email notifications designed to make the merchant more effective and notify them about new products and services. The gift and loyalty marketing business is dynamic and growing. It pays to partner with a company that will keep you informed of industry trends and tips to increase your sales.
If you're business is like most that make the plunge into gift cards, it can be a very wise and profitable decision. But once you make that plunge and choose a gift card partner, switching later to a different provider can be a difficult conversion process. So, invest a little time to ask the above type of questions and choose a supplier that delivers a program perfect for your business.
About the Author:
Al Duggan is an expert in developing a gift card program and is the VP of Business Development for Valutec Card Solutions, LLC, a Metavante (NYSE:MV) company, the nation's largest provider of plastic gift cards to small to mid-sized businesses.
No comments:
Post a Comment