Following the unprecedented disruption and volatility caused by the Covid-19 pandemic, retailers need to be maximising every revenue opportunity during this holiday shopping season. The right voucher strategy can play a critical part in maximising revenue growth and brand loyalty.
Typically, there are two types of vouchers used by retailers. The first is the promotional voucher, which is designed to reward customers and encourage them to increase their spending or to make another purchase. The second is the gift voucher which taps into the gifting market and extends your brand exposure beyond your existing customers.
A disconnected experience = missed opportunities
Whilst the opportunities from vouchers are wide-ranging and high impact, many retailers aren’t realising their full potential. They are offering a disconnected experience whereby vouchers are only able to be purchased and redeemed in-store or online – not both.
This significantly impacts the experience for your existing customers and can lead to a poor first experience for new customers acquired through the promotional campaign.
Delivering a connected omni-channel voucher experience
Promotional vouchers can be used for targeted marketing campaigns. After you’ve identified a certain segment of your customer base, you can then provide them with an incentive to revisit your store. The goal is to get your customers to spend more than the amount you’re giving away for free.
The options of which customer segments you can target with promotional vouchers is endless. They could be customers who have purchased a very specific product, or maybe a customer who has spent a specific amount of money in a certain amount of time. You can even use promotional vouchers for retargeting customers who have abandoned their cart to complete an online purchase or to reactivate lapsed customers giving them an incentive to revisit your store.
The real success of promotional vouchers, however, is only realised when the vouchers are redeemed. So, it’s crucial that your promotion is valuable.
If your customers aren’t redeeming your vouchers, you’re not driving the behaviour and the incremental increase in spend that you were aiming for. You also run the risk of an accumulation of non-redeemed vouchers on your balance sheet.
Because of this, it is critical that you offer your customers the chance to redeem these vouchers via multiple channels for their convenience. Namely, you should make it possible for them to redeem their promotional vouchers online and in-store. Both should be options – not just one or the other. Otherwise you are creating friction and reducing your redemption rates.
Retailers fail to do this all the time, mostly because their instore and online channels and systems are not set up to enable cross-channel voucher redemption. Though it may take some time and investment, with the right systems you can make it standard that promotional vouchers that can be issued and redeemed through any channel.
If you plan on offering multi-channel promotional vouchers, there are a few best practices to consider.
- Include an expiration date so that there is more of a sense of urgency to redeem the vouchers. This also mitigates the risk of having un-redeemed vouchers on the balance sheet
- The right system also enables your staff to see which customers have received promotional voucher offers when they visit the store and remind them to redeem the offer.
- You might even want to consider implementing a loyalty points system for your customers in which they will receive a promotional voucher based on tiered purchase volumes.
Gift vouchers are a different proposition to promotional vouchers where you need to maximise convenience not only for the gift giver, but also the gift receiver.
The giver is not likely to purchase a gift voucher from a business that doesn’t provide multi-channel purchase and redemption options. The giver wants the convenience of purchasing the voucher via the channel that suits them and statistics suggest that is more likely to be online due to the convenience this offers.
However, without multi-channel voucher options this means that the receiver is only able to redeem that voucher online, even if they would prefer to do so instore. As a retailer you are missing out on the opportunity to acquire and grow a new customer relationship that may be purchasing with a voucher for the first time.
As with promotional vouchers, you should use a cross-channel voucher strategy and make purchasing and redeeming gift vouchers online and in-store easy and convenient.
Again - with the right systems - gift vouchers can be purchased and redeemed interchangeably online and in any store. And your customer experience becomes truly omni-channel.
Your voucher strategy plays a critical role in driving revenue and increasing customer lifetime value as well as driving brand and customer loyalty. But if there is friction built into the process across your different channels, you’re unlikely to see the full benefits.
Creating a connected omni-channel voucher experience will set you on the path to increased revenue, market share and brand loyalty.
At Retail Express we work with hundreds of clients who have achieved positive results from their omni-channel voucher strategies. To find out how other retailers in your category have successfully implemented this strategy, simply book a free demo today.