Michael Maxwell – Partner, Blue Orbit Restaurant Consulting
Often, I run across restaurant managers who find that selling gift cards is more trouble than it’s worth. People want to buy gift cards during busy shifts, someone has to grab the cards out of the safe, no one can remember how to put credit on the card, or the envelopes are too hard to fold. There are countless excuses. So first, I should probably tell you why you should be enthusiastic about the gift card process.
[quote]Every holiday season consumers spend billions – yes billions – of dollars in the U.S. on gift cards… and about 50% of these gift card sales is spent on restaurant gift cards.[/quote]
There are several reasons why you should want to get your fair share of these sales:
- It is immediate cash flow with a minimal cost of goods attached.
- It is a great way to introduce new customers to your restaurant.
- Gift card users tend to see the card as “free money” and traditionally spend over the amount of the card.
- Many gift card givers like to join the gift card recipients when they dine to showoff their favorite restaurant, which in turn increases the dining frequency of regulars.
- Those who don’t overspend either underspend or don’t use the card at all, meaning it’s free money for you.
Now that you are on board, let’s talk about ways to get more than your share of gift card sales.
- Make the Purchase Easy: Many restaurants still make guests stand at the bar and wait for the bartender to buy a gift card. This is the worst possible way to create the sale. Be sure to have your hosts equipped to make the sale and staff extra people where necessary. In the days before Christmas, it’s a good idea to schedule someone at least an hour before opening to catch all those last-minute shoppers. We’re in the digital age, so your gift cards need to be available online for purchase. It’s a plus if it can be emailed to the recipient or downloaded to mobile devices.
- Offer Special Promotions: Offering an additional amount on the card or an additional free gift card with varying purchase levels is a start, but it’s also what everyone does. Try to be more creative with your promotions. For example, offer a “build a meal” bonus: $50 purchase gets you a free dessert, $100 equals dessert and an appetizer, $200 equals dessert, appetizer and an entrée. Or offer unique rewards like 2 free tickets to your upcoming cooking class or wine tasting. The goal here is to stand out in a sea of sameness.
- Promote Your Gift Card Program: You can have the best food, the most creative drinks, and the best purchase offer, but if you don’t let anyone know about it… then it’s doomed. Here are a few best practices for gift card promotion:
- Use in store signage and displays.
- Use call outs on your menus or menu inserts.
- Contact everyone in your email lists.
- Maximize use of Facebook, Instagram, Twitter and all other forms of social media.
- Update your website with information about the promotion and links to point of purchase.
- Update all on hold messages and all reservation responses to mention gift card purchases.
- Engage your landlords and use all of their marketing formats.
- Leverage Your Loyalty Program: We are a world obsessed with loyalty points. If you have a loyalty program, double the amount of points you get for gift card purchases and email all your loyalty members to let them know. If you don’t have a loyalty program, get one.
- Engage Your Staff: Yes, I saved the best for last. First, engage your catering or event sales team. Give them specific sales goals and encourage them to target corporate clients that would purchase blocks of gift cards. Make sure they get a bonus for hitting their sales goal. Incentivize your servers, hosts, and cashiers with a month-long sales contest and make the prize a good one. Encourage them to not only sell during their shifts, but to people they encounter in their daily lives. Most of all train, train, train. Make sure your team is equipped with the right words to make the sale. Talk about sales techniques in daily team meetings and allow everyone to share best practices.
Gift cards are an excellent way to retain existing customers, generate new customers, and grow sales. A heavy push to sell them during the holiday season boosts your sales for the entire year. Normally you should put together your sales plan at least six months before the holiday season, but using the 5 steps mentioned above will still put you ahead of the competition in gaining your share of the pie.