On average, consumers in the U.S. spend over $100 billion dollars on gift cards every year. If you're a dispensary operator, a gift card program is an excellent tool to help you not only attract customers, but also rake in additional revenue.
In this article, we’ll show you a few simple ways you can get the most out of this popular strategy for your cannabis business. You’ll learn:
Generally, a gift card program allows businesses to sell redeemable gift cards for their merchandise to their customers. There are two kinds of gift cards to consider when starting up your program: open and closed loop gift cards. Both of these options can benefit pretty much any kind of retailer, but closed loop gift cards are ideal for cannabis dispensaries since they’re designed to be used solely at your store.
Selling gift cards can be a big help to any dispensary without a ton of effort on the part of the owner or operator.
Gift cards are a strong form of building brand awareness for a dispensary because they’ll usually include a store’s logo, name, social media, and contact information on it. Plus, an increase in gift card sales means a potential increase in the number of people seeing your gift cards. You never know who'll see a gift card from your dispensary and be curious enough to look you up. So whenever a potential customer looks in their wallet, they have a reminder that you’re a destination for cannabis products.
Additionally, gift cards are a great way to boost sales. Studies show that customers are willing to spend more with a gift card versus spending their own money and, on average, spent over $30 more than the value of their gift cards last year. The type of gift card you sell can also make a difference. Selling plastic gift cards instead of paper gift certificates can also increase gift card sales by 35-50%.
Giving a retail gift card as a gift can bring in new customers, too. Gift cards are primarily given as birthday, holiday or thank you gifts. Your loyal customers can give a gift card to a friend, who, for you, is a potential new customer. Let’s say one of your best customers gives their friend a gift from your dispensary. If your customer gives their friend a gift card to your boutique, they have no choice but to visit your shop to redeem it. In fact, 44% of people in a study visited a store that was new to them because they received a gift card and even more people visited stores more often after they got gift cards.
They’re also very cost effective—typically, all you pay for are the physical cards themselves and customization.
Gift cards are a form of payment, which means that there are laws surrounding how they can be used. Be sure to research the local regulations in your market before proceeding.
A gift card program can only be successful if consumers know about it. Well-established retail giants like Target and Best Buy of course sell a huge number of gift cards during the holiday season—but it’s not just because of their reputations. They also ensure their customers know about their gift card program. They market their gift cards in-store by displaying them on every checkout counter and having their team members offer them to customers upon payment.
To get your customers noticing your gift cards, consider marketing them in-store. Train your budtenders to offer customers as many opportunities as possible to see and hear about your gift cards while they’re shopping and at checkout.
Gift cards are most commonly sold as birthday or holiday presents. But they can also be used for marketing campaigns and promotions. Use them as an incentive for customers to spend more, buy specific items you want to upsell, and return to your dispensary.
Run gift card cash-back promotions by rewarding your customers with a gift card when they spend over a certain amount. For example, “for every $100 you spend, get $10 back on a gift card”. This encourages all customers who take advantage of the offer to shop with you at least one more time.
Finally, get creative! Whip up a gift card design that gets shoppers excited about your dispensary by creating a visually appealing design reflective of your brand.
A boring, unoriginal gift card won’t get people motivated to shop in your store. Use colors, visuals, and fonts that fit in with your brand style guide to create a truly unique gift card that stands out from others in your market.
Gift cards are one of the most requested holiday gifts. The best practices outlined in this article can help you get your gift card program on point so you can stake your claim in the $100 billion dollars that are expected to be spent on gift cards over the next 12 months.
Looking to start selling gift cards at your dispensary? Chat with one of our experts and see how Dutchie POS can help you start, operate, and grow with confidence.
Dutchie is an all-in-one technology platform powering the cannabis industry with Point of Sale, Ecommerce, Payments, and Insurance. Through our technology, we’re helping cannabis businesses start, operate, and grow with confidence. With software that simplifies their operations, our customers can focus on what matters most—bringing the benefits of cannabis safely to consumers.
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