I love Starbucks, my favorites it s Chai Tea Latte! So anytime I see an article on Starbucks, I like to read it and see what the Company is doing. I just read an article from Business Insider that said Starbucks has over a BILLION dollars sitting on gift cards! That is a staggering amount of money! But the reason I am writing about this, is to relate it to your business.
Gift Cards are actually the #1 or #2 most popular gift given each year. An astounding 6% of gift cards are never used and up to 15% of gift cards have had at least one purchase but are not fully used.
As you may know, I have been in retail for over three decades and I have seen a lot of gift cards. In my experience, a customer who comes into a shop with a gift card, they treat it as “free money” or a “big discount” and usually spend double the amount of the gift card! Meaning, a customer who comes in with a $50 gift card will spend $100 because she sees it as getting her items for a 50% discount!
So how can this help you, in your business? When a person comes in to purchase an outfit for a friends birthday dinner and night out, at the end of the transaction, ask her if she’d like to get her friend a gift card to the shop. You’ll get the money for the card now, and you’ll get the “extra spend” when the friend comes back.
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