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What are gift cards?
Home » Small Business » Gift Cards » What are gift cards?Gift cards are one of the fastest growing markets in retail. Gift cards are easy to purchase, easy to use, and have become very popular with consumers. A survey by the National Retail Federation found that almost half of the 1,000 shoppers polled reported that they plan to give gift cards during the upcoming holiday season.
Recent trends show gift cards have surpassed paper gift certificates by more than 600 to 1. They can increase profits while simplifying the gift certificate process. Since gifts cards are easier to purchase than paper gift certificates, they increase customer satisfaction and can lower return rates as well. Gift cards can be processed using a store’s current credit card processing equipment and merchants can benefit from the increased revenue that gift cards generate without significant up-front costs.
Some major retailers offer added incentives for use of their gift cards in the form of lower prices for items paid for with a prepaid store card or special discounts when the card is used for an online purchase.
Gift cards are appropriate for many types of businesses, not just major retailers. Restaurants, discount stores, book stores, toy stores, video rental stores, and even day spas or beauty salons offer consumers another alternative in gift-giving. In many circles, gift cards are the item of choice at children’s birthday parties. Not only does the child receive a gift, but they also enjoy the power that comes from making a purchase on their own.
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