How to Create a Gift Certificate Program

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Written By RobertMaxfield

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It’s that time again – you’re starting off a new year and thinking about your business goals for the year. One of those goals will most likely include an intention to bump up your business a little and bring in some more revenue. One promotional idea worth exploring is a gift certificate program. Retailers almost always have a gift certificate system in place, but a lot of service businesses don’t.

Why not? The answer I hear most often is “I haven’t got around to it yet!” So I’m going to share a couple tips to get you started.

What kind of gift certificates do you want?

There are 2 basic types. It’s really nice to have both:

The paid-for kind of gift certificate is purchased by one of your customers for another person. Not only is it a way to serve new customers, it’s a way to serve your current ones. People love sharing experiences, and when you create a really positive one for the recipient, the gift giver will feel great about it!

Another type is the free gift certificate. That might be a gift from you to a current customer, a promotion to attract new ones, or a thank you gift for the people that help you throughout the year.

Tracking your gift certificates

The simplest way is to create a paper log-book or Excel spreadsheet. Besides recording the purchase date, amount, recipient’s name, and redemption date, also include the purchaser’s name & contact information in case you are must issue a refund as per some state laws.

Showing the dollar value

If you’re in a service business, most people buying gift certificates are paying for a particular service they want their friend to have. In this case, it’s really nice to write that on the certificate itself, for example, “Good for a 60-minute Reiki session.” But what if you raise your prices later or the recipient wants something different? It’s smart to put the dollar value on the certificate, in a very small discreet way.

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On free certificates, you might want to show the dollar value so people understand its worth, but write “no cash value” very small so that there’s no confusion about it being refundable for money.

To present or not to present?

Businesses often stipulate that the certificate “must be presented at time of service.” That policy does help prevent fraud, but you can’t enforce it without getting the customer really upset. This is where your tracking system is truly necessary. Don’t be surprised when 98% of gift certificate holders come in without the paperwork. Trust me on this one. It’s better to be elegantly prepared.

Expiration dates

In most states, it is illegal to put an expiration date on gift certificates that were sold for money. If you feel anxious having unused certificates floating around without expiry, you may put a “must be redeemed by” date on them, but here’s the rule: when the expiry date passes, you must refund the purchaser in full. Only after you’re refunded the purchaser in full can you void the certificate.

The no-expiration rule does NOT apply to free certificates. Since no money has changed hands, the expiration date is up to you.

Refunds

You can pretty much create whatever policy you want, as long as you have one. You can offer cash refunds, “store credit only” refunds, or a combination. For example, if you sold an hour massage certificate for $100, but the redeemer only wants a $65 pedicure, your policy will determine whether they get cash back, credit towards future services, or if they can use the difference to buy products or put it towards the tip.

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Do keep in mind that if you should happen to go out of business, you are required by law to issue cash refunds to the purchasers of all unused gift certificates. That’s why you need to keep records.

You will need to check with your particular state for any area specific laws that may govern your area. A good place to begin this search is with your state’s Department of Consumer Affairs.

How to design your gift certificates

There are 3 basic ways you can create your certificates. I’ll start with the least expensive ones first.

Do-it-yourself gift certificates from your computer The most affordable way is to use a program like Microsoft Word or Publisher. If you aren’t sure how to start from scratch, there are free templates you can download and customize at the Microsoft Template Gallery.

Alternatively, most office supply stores have pre-printed gift certificate stationery for sale. You can format them with your computer, or even hand write them if you’ve got nice writing.

Pre-printed gift certificates

Just like ordering pre-printed checks, you can order pre-printed gift certificates. These cost a little more, but they can look really nice with your logo or embossing done on nice paper. A company called Gift Central even sells tracking forms you need, if you’re not sure how to do it yourself.

Credit-card style gift certificates

If you’ve got a bigger business with a POS checkout system, these are pretty cool. It used to be that only huge retail stores had this type of certificate, but now anyone can sell them. Because they look like a credit card, people understand that they must present the card to use it, and it makes “store credit only” refunds really easy to manage.

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Make it special

Whatever kind of certificate you use, make it look as attractive as you can. It should fit the style of your business, and its perceived value should match the gift. So if you’ve got a $200 gift certificate for example, it should be on nice paper, in a nice envelope, or maybe even a gift box.

Have fun creating your gift certificates!

Jaya Savannah of Inspiration, Inc. is a business consultant and Professional Certified Coach who specializes in management coaching and training for holistic businesses. Audiences connect with her mentoring advice & spiritual wisdom, delivered with a street-smart “let’s get it done,” approach. Jaya is the co-creator of the Power Up! seminar and DVD series, a business blogger, trade magazine writer, and popular speaker at spa industry tradeshows. She’s dedicated to improving your business-and your life!  Subscribe to the Inspiration, Inc. email newsletter  and receive a gift of Jaya’s Inspirational Days & Nights Guided Coaching Meditations on Mp3.