Gift Cards in a Time of Global Crisis: Payment Technology Providers, This is Your Moment!

We have been pleasantly surprised to see the incredible response from tech companies around the world, who have rushed to adapt their core services to come to aid where it is most needed during this pandemic.

The gift card industry is no exception here. Payment technology providers servicing SMEs around the globe have taken note of the impact on their customers and affiliated industries and are taking steps to help wherever possible.

One of the main ways they are bringing their expertise into service is by offering digital gift cards as a crisis tool for businesses to bring in some much-needed cash while their doors are closed. After all, many small shops and restaurants have been forced to close their doors and rely solely on online orders and takeaway deliveries during this crisis.

Payment technology providers have been providing a valuable promise to their customers: invest in selling digital gift cards to your patrons now, and let them use them when you re-open. Gift cards can be used as “microloans” from their most loyal customers, who want them to weather the storm and re-open as quickly as possible.

The response from SMEs so far exceeds all expectations, the amount of local businesses that have started embracing gift card programmes since the beginning of the crisis is bigger than ever.

Feedback from consumers is equally overwhelming – digital gift card sales for small to medium-sized businesses have grown at an unprecedented rate, and fast-moving tech providers are doing everything they can to utilize the momentum of this surge in demand.

For many, what was predicted to be a period of financial slumber is fast becoming a phase of exciting growth, new clients and innovative business models.

But what should established payment service providers and tech providers new to the gift card world be aware of?

Digital gift cards can do a lot to help small to medium-sized businesses – and your company, in turn, can be a vital part of this movement. But you need to act quickly and get up and running as soon as possible. A number of tech providers have already begun focusing on offering gift card solutions to SMEs, so if you are considering launching a similar programme, it might be a good idea to launch it in countries with no initiatives present as of by now.

If your goal is to support a large number of customers, consider entering into partnerships with other companies who serve your business target audience such as restaurant organisations, fashion bloggers, local non-profits or even other partners in the tech industry – anyone who is invested in supporting small businesses already.

You are completely new to selling gift cards? Just be careful not to underestimate the complexity of this industry. Gift cards are considered a branded currency, i.e. money, and thus a plethora of financial, legal and operational considerations must be taken into account in order to provide a solid service. Get support from industry experts if you are unsure of how to proceed.

In order to help small to medium-sized businesses, remember they are fighting for survival. What they need is a simple, easy-to-launch, no-frills proposition. Ideally focused on digital with regards to speed of execution and with a business model that you and they can quickly get off the ground. I see a lot of providers offering discounted fees or advantageous pricing at the moment – if you can afford those financial efforts, that’s your contribution to helping them out of the crisis, every bit of financial flexibility helps them as of by now.

What about after the crisis? How to make sure this moment of unexpected growth translates into ongoing business and lasting customer relations?

Don’t forget to think ahead! You might be growing a client base or business model without even having to go door to door to actively sell it – so you want to make sure you can leverage that momentum once things are back to normal. I recommend developing a full and thorough understanding of the gift card market in order to continue to operate successfully within this in the long run.

It might not be a given that restaurants, boutiques and shops are continuing to use gift cards once the crisis is over and their business is buzzing again. Think about how to motivate them to keep gift cards as an offer, how to make the benefits tangible and the service proposition attractive.

Many local businesses, especially those who are new to the field of gift cards, will need help and guidance from their providers to ensure they make the most of gift cards and are taking the right decisions. Questions that might pop up are: How can a small business continue promoting gift cards once they physically re-open? Could gift cards be utilised as a loyalty tool? What about promotional mechanics? Should they also incorporate physical gift cards into their programme?

Be ready to support your customers answering these questions and start planning your long term strategy now!