Should You Offer Gift Cards To Customers?

Gift Cards for Business: Boost Sales and Attract Customers (pros & cons) | CIO Women Magazine

Gift cards for business were first introduced in the 90s and have become incredibly popular since. Along with traditional physical cards that must be used in physical stores, it’s also now possible to create digital gift cards that can be used to purchase products and services from websites or apps. This has made it possible for all kinds of businesses to take advantage of gift cards.

But are gift cards really worth the investment?

This post explores some of the pros and cons, as well as looks at how you can introduce gift cards for business:

What are the advantages of gift cards?

Gift Cards for Business: Boost Sales and Attract Customers (pros & cons) | CIO Women Magazine

When a customer buys a $30 gift card and gives it to a loved one, you receive $30 whether the card gets used or not. Unused gift cards can therefore end up being highly profitable. Of course, many gift cards do get used, and these can be great at encouraging customers to use your business. Some may even spend more than the value of the gift card on an item they never would have planned on buying. This makes them great ways of potentially boosting business. 

What are the disadvantages of gift cards?

You’ll need a payment processing system in place that can process gift cards and employees will need to be trained how to correctly activate gift cards for business and how to process them. This does mean a little extra admin. The biggest disadvantage of gift cards however is their potential to be used fraudulently. There are thieves out there who use stolen cards and stolen card details to buy gift cards, which are then untraceable. Fortunately, there are ways of making gift cards traceable, which can help to counteract fraud. 

Which companies benefit most from gift cards?

Gift Cards for Business: Boost Sales and Attract Customers (pros & cons) | CIO Women Magazine

When deciding whether to provide gift cards, you need to consider whether your product or service is realistically likely to be bought as a gift for someone. Gift cards towards high-value products are rare – few people are realistically going to buy someone a gift card to use at a car dealership or sofa store. Because $50 is often the max people are willing to spend on a gift card and customers typically want the recipient to get some freebies out of that, gift cards are better suited to businesses that sell lower-value items. Some of the most common types of businesses to provide gift cards therefore include clothing stores, bookstores, toy stores, DIY/craft stores, coffee shops, and restaurants. 

How do you start accepting gift cards?

Some basic payment processing systems may not allow you the option to set up gift cards. This is a good reason to go North for your payment processing needs – companies like North allow you to set up an array of different payment processing options including gift cards. If you’re operating an online store, you’ll need to use an online payment processor that offers gift cards.

Gift Cards for Business: Boost Sales and Attract Customers (pros & cons) | CIO Women Magazine

You can decide whether to offer gift cards in set amounts or allow customers to top up the gift card to whatever value they desire. Make sure to promote your gift cards so that people actually take advantage of them – this could include clearly displaying them near your checkout or advertising them on your website during the online checkout process. 


Gift cards may not be suitable for all businesses and do have their downsides such as extra admin and fraud risk. However, most B2C low-value retailers and restaurants will likely find gift cards for businesses to be an attractive and profitable feature. Just make sure to choose the right payment processing system so that you can issue and accept gift cards properly. 



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