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Sell physical gift cards

How do you consult for customers who are buying products or services for their friends and family? How often do you encounter a situation when customers come to your stores to exchange items they are given from others? As retailers, you may have to handle these situations in day to day basics. How could we make things easier?

Our suggestion is to use physical gift cards. They help givers choose suitable gifts more easily, bring the freedom of choice for receivers, increase word of mouth, and more importantly boost sales. What should we do to maximize all those benefits? Let’s discover further.

What are physical gift cards?

Physical gift cards referred to virtual cards either in plastic or in paper which retailers offer for sales in their offline stores. The most popular forms of physical gift cards include barcode and magnetic stripe.


Barcode gift cards

Barcodes seem to be typical for membership or customer loyalty programs as they don’t require much data security and are quicker to scan. They use a bar system (a barcode with or without a series of characters – letters and numbers) to represent a unique number that your POS and scanner will read to track the usage of gift cards. Your POS system keeps all information about the gift card in terms of monetary value and other data don’t show on the card itself. Barcode gift cards are often the easiest way to integrate with most POS systems.

Magnetic stripe gift cards

Compared to barcodes, magnetic stripes have more superior data security as they use black magnetic stripes which are unique to each gift card. These gift cards are swiped in your payment system just like a credit card or debit card bringing greater ease for customers to use. However, you may notice that, if the card is stored for a long time in a purse or wallet, the stripe can gradually wear out. It will be difficult to search for customer’s information in your system.

Benefits of physical gift cards

Don’t overlook the values of physical gift cards. You should consider adding them to your marketing mix to engage customers and boost sales. But let’s see how they can contribute to your business first.

Increase revenues

This is the most notable benefit of physical gift cards. They are basically items offered for sales. Their difference with other physical products is customers can buy them now, then come back to your stores and use them later. Thus, we can consider gift cards a prepaid amount for the next purchase. That induces customers to return to your shops to use the card’s full value. Through multiple visits and sales, you will have more opportunities to upsell new products whenever customers come back.

Besides, a study by First Data on 2018 Prepaid Consumer Insights showed that US consumers who pay with gift cards, spend about $59 more than the value of their gift card. As they have confidently known that at least part of their purchase is paid that prompts them to buy more than they had originally intended.


In case, the gift cards are left unused or the customers don’t use up the card value, you still get that profit. In such situations, thoughtful customer service will help you win your customer’s heart. Before their physical gift cards expire, you can notify your customers and remind them of visiting your stores to use the card. Or if they haven’t used up all the card value, you can advise them to consider buying other items. By doing that, customers can feel how you truly care about them rather than try to sell at all costs.

Build brand awareness

We all know the importance of word of mouth, especially our friend’s practical tips for products or services. But sometimes, we only get convinced until we have a chance to test the product. Back to the daily situation we’ve mentioned in the beginning. If a customer loves your brand and wants to suggest it for their friends or relatives, they can buy your products and give them to their friends. Sometimes, the products don’t fit with the receivers and they have to come to your stores in exchange for other items. It may cause inconveniences and bad shopping experiences.

What should we do about it? Offering physical gift cards for customers appears to be the most appropriate solution. We all love receiving gifts. So let your customers the chance to give your gift cards to their beloved ones. Thus, those introduced can visit your stores and experience shopping rather than coming to ask for problem-solving, in this case, it is an exchange for other items.

Capture more sales during the holiday season

Do you know that gift cards are often chosen by customers who are hustling for gift alternatives in the holiday season, even a few hours before giving to others? Why don’t we help these last-minute shoppers? Let’s offer them physical gift cards. There’re a lot of items in your stores, meaning the receivers are empowered with various choices of items from you. More interestingly, many givers don’t want to reveal the gift value. In such a case, physical gift cards are an ideal option.

Develop and enhance customer loyalty

To effectively utilize the benefits of selling physical gift cards, you’d better put them in your customer loyalty program or marketing mix to track their performance. On some special occasions such as their birthday, Christmas, New Year, etc., you can give your customers gift cards to show your care to customers and to warm up your relationship. Selling gift cards besides bonuses or discounts for certain spending levels, your customers are more likely to return to your stores. If customers buy your gift cards to give to others, you have more chances to attract and induce new customers to visit your place. Moreover, if the gift cards are about to expire, you can remind customers of this possibility, to express your thoughtful care to them.

Process of selling physical gift cards

Let’s look at the business requirements before jumping to the process. Essentially you need the same gift card which is redeemable in-store and on the website. It means, when a customer purchases a physical gift card at the POS, the sales staff should be able to redeem it on the website and vice versa. You should use an omnichannel system that allows you to handle gift card data from across sales channels in only one centralized system.

In addition, if possible, we would recommend you use physical gift cards – plastic ones with a magnetic stripe or barcode when purchased in the retail store, as well as virtual ones that get emailed if the customer chooses that option. To choose the best way to operate a gift card program for your business, let’s talk with our experts.

The workflow of selling physical gift cards comes as below:


When a customer wants to buy a physical gift card, the cashier will search for the product on POS. Next, they will scan the barcode of that physical gift card to fill into the gift code field and the dynamic value that the customer would like to purchase, then proceed to check out. The gift code is updated and activated in the Magento system simultaneously.

How customers use gift cards in reality:

Each gift card is assigned with a unique gift code to avoid thieves and to be easy to track. When recipients get gift cards, they have the gift code to use as a discount for online and offline purchases. 

For online purchases: after choosing items they want to buy, the customer can proceed to checkout and enter the gift code. It then shows the amount of money that will be deducted from the total amount by using gift cards. To complete the transaction, the customer will confirm to pay for the rest of the order on the credit card or pay later when receiving all the items.

For online purchases: at checkout, customers can ask the cashier to enter the gift code. That also shows the amount of money subtracted from the total amount. Customers can choose to pay for the rest of the order in cash or by credit card.

How cashiers check out a gift card that has been already on POS

If customers want to use a gift card to pay for their order, the cashier can enter the gift code at checkout. If the gift card value can cover all the order values, then the cashier can immediately complete the transaction. If the gift card value can only pay for a part of the order, the cashier informs the customer to pay for the rest of the order in either cash or credit card.

Tips to increase physical gift cards sales

Now that you’ve known the benefits of physical gift cards to your business and the process for selling them. It’s time to look at how to promote your gift cards and maximize sales. 

Boost their in-store viability

Identify the most attractive places which have the most touchpoints with customers in your stores such as the checkout counter to put your cards. Besides, you can also set up a gift section display in your shops, and make it more alluring with seasonal ornaments. Don’t forget to offer some nice gift card holders to help amaze the card receivers.


Sell them with relevant items

Laying physical gift cards to sell them with relevant items increases the presence of the cards to your customers. For example, if you’ve prepared a display for selling Christmas related items, remember to provide gift cards there as well.

Create and offer gift cards on special occasions

Many customers would love to receive gift cards, especially on special occasions. It’d be better for you to add a gift card program to your calendar for such special occasions. Besides the general days like birthday, Christmas, New Year, depending on your business, you can offer special gift cards on Family’s Day, Mother’s Day, Father’s Day, Book’s Day, etc. Your sales on special occasions can increase dramatically so you should adjust your stock daily to make sure the goods are available for sales.

Offer discounts for them

Instead of selling $100 gift cards for exactly $100, you can offer a tempting deal. Let’s say, $90 to get a $100 gift card or $90 for a $90 gift card plus a bar of soap. Less for more right? Your customers would love it. 

Market physical gift cards across different channels

The more your cards appear on multiple channels, the more chances to sell them. Promote them on all channels you have such as website, social media, email marketing. As we’ve mentioned, you should add physical gift cards to your marketing mix to track their performance.

Ask your partners to co-sell physical gift cards

Why don’t you ask for your partners to sell your cards and help sell their cards in return? For instance, wine retailers can sell gift cards of cake retailers. These are nice presents for the holiday season, aren’t they?

In summary

These small yet awesome physical gift cards bring about plenty of benefits to your business, from brand awareness to sales growth. Remember to add them to your marketing plan and consider the 6 ways to maximize their sales above. Make your daily sales as booming and exciting as in holiday seasons. Let’s talk with our business consultants to design a proper gift card or customer loyalty program for your business.

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