September 20, 2007

Gift Card Customers

Please click on the image to enlarge it (it may be a challenge to see the small numbers in the chart, FYI).

Our industry loves to tell us that we need to have a viable Gift Card program for the Christmas shopping season.

Our industry seldom tells us how customers who purchase Gift Cards for others behave, long-term.

The Multichannel Forensics framework is well-suited to understand if customers who purchase Gift Cards for others behave, long-term.

The attached simulations illustrate what you want to see happen.
  • Customer purchases a Gift Card for another individual.
  • Other individual (not illustrated above) redeems Gift Card for merchandise.
  • Customer who purchases a gift card becomes more loyal, and spends more, long-term, than customers who don't purchase Gift Cards for others.
You have an opportunity to analyze how customers who actually purchase Gift Cards behave, long-term, vs. other customers. Hopefully, you'll find that your Gift Card program provides a double-whammy ... increased sales from the Gift Card, and increased long-term loyalty from the customer purchasing the Gift Card.

In many order-entry systems, the customer who purchased the Gift Card has a notation placed in their customer record. Use this information to your advantage!!

2 comments:

  1. Anonymous10:12 PM

    >>Customer who purchases a gift card becomes more loyal, and spends more, long-term, than customers who don't purchase Gift Cards for others.

    A leap of inference. Perhaps people who will become high-spending, loyal customers anyway simply buy gift cards more often than those who won't become high-spending, loyal customers. In other words, they'd be that way with or without the gift cards.

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  2. Anonymous, you only included the part of the quote that benefitted your argument.

    Notice I said that "the attached simulations illustrate what YOU WANT to see happen". I did not say that this is actually what happens. A business leader "wants" this to happen. One can use Multichannel Forensics to prove or disprove the hypothesis.

    Anonymous, demonstrate how you would use data to prove your argument, with or without gift cards existing.

    ReplyDelete