Hot Holiday Trend: Gift Cards that Give Back, Personalize and More

Although the National Retail Federation predicted that gift card spending would drop this holiday season as more shoppers are expected to pound the pavement and scour the Internet in search of discounts, they are not to be completely counted out. Recent numbers released by First Data showed an uptick in gift card performances during the week of Black Friday, as the restaurant segment has so far seen increases in both the total dollar value of gift cards sold (3.4%) and in average gift card amounts (6.5%). And for many operators this holiday season, the traditional gift cards of yore are getting a complete makeover in a play to boost sales and gain customer loyalty.

Cards with personality
A number of restaurants, including Dunkin' Donuts and Uno Chicago Grill, are offering guests the option to inject some flair into the design of standard gift cards through virtual personalization. This is expected to offer restaurant gift card programs differentiation this year while personalizing an item that is often criticized as being an impersonal gift.
On Cyber Monday, Dunkin' Donuts began offering shoppers the option to personalize gift card purchases online with photos or customized messages. Dunkin' Donuts custom gift cards are also accompanied by a custom designed greeting, and greeting cards can be selected from a wide assortment of designs to fit the holidays. However, these customizations are not free-of-charge for customers, who can expect to pay an additional $4.50 for the extra service.
Similar to Dunkin' Donuts' strategy, Uno Chicago Grill is also offering customers the option to personalize gift cards this holiday season. They offer a virtual version that is delivered straight to the recipient's e-mail. Plus whenever shoppers purchase a $25 gift card, they will receive an additional $5 bonus voucher that's valid from January to March.

"With consumers cutting back due to economic pressures, restaurant gift cards will be a popular alternative to retail cards this holiday season because people are more likely to welcome a fun night out," says Rick Hendrie, Uno's senior vice president of marketing. "In this case, you're also rewarded for being generous with a bonus voucher for each $25 purchase."

Additional offers sweeten the pot
Many restaurants like Uno are offering gift card buyers extra incentives when making their purchases. Denny's is offering guests a free $5 Denny's card with the purchase of a $25 Denny's gift card at participating restaurants.

"The gift card market is a strong and popular one," says Mark Chmiel, Denny's chief marketing and innovation officer. "Denny's offers this desired gift item to guests, but also gives back to them with the gift of a $5 Denny's card. They can buy a practical, affordable item for friends or family during the holidays and then have the luxury of spending something on themselves at another time."

Dunkin' Donuts also tapped into this trend with their recent partnership with American Express. Whenever guests use their American Express card to sign up for the automatic reloading feature on the Dunkin' Donuts Card, American Express cardmembers will receive a 20 percent bonus on each Auto-Recharge transaction of $25 or more. Plus for every $25 Auto-Recharge, American Express will automatically load an extra $5 onto the Dunkin' Donuts Card through March 31, 2010.

"The Dunkin' Donuts Card is the convenient way to pay at Dunkin' Donuts and this partnership with American Express will help us deliver more value, more rewards, and more convenience for our customers," says David Tryder, Dunkin' Donuts' director of interactive and relationship marketing.

Rewarding loyal customers
Restaurants are also targeting their base of loyal customers with gift cards that double for loyalty programs, a strategy that the national chain Pita Pit USA has recently adopted. Their PIT Card is an integrated gift card and loyalty program that can be loaded with any prepaid amount or used to accumulate points toward future purchases with every swipe. PIT Cards are on sale now at participating locations, with an automatic ten-percent bonus on the purchase amount if bought before December 31.

"The implementation of this program in time for Christmas is exciting for the Pita Pit as a national community," says Peter Riggs, VP of Pita Pit USA. "The PIT Card lets us reward our loyal customers with fantastic discounts and promotions, and can also be used as a gift that truly keeps on giving."
This ad will auto-close in 10 seconds