Limit returns after the holidays with gift card programs
December 20, 2013

Small and medium-sized retailers have the opportunity to limit the number of returns they receive in the wake of the holiday shopping season by offering gift card programs to customers.

According to a recent poll from Consumer Reports that collected responses from 1,500 U.S. adults, 1 in 5 consumers were disappointed with at least some of the gifts they received in 2012. Because of the many challenges associated with finding the right products for family and friends, it's possible retailers may spend a substantial amount of time processing returns during the end of December and throughout the entire month of January. In fact, 15 percent of respondents said they either returned a gift or exchanged it for something else last year.

Rather than running the risk of losing money after the holiday season, retailers can easily ensure long-term revenue growth by marketing gift card programs as an alternative to purchasing individual products. The comparison shopping website Fat Wallet estimated digital gift card purchases will grow more than 30 percent this year, thanks to an abundance of companies who are offering such options over the Internet in addition to their brick-and-mortar locations.

Gift card programs make it easier for consumers to find gifts that their friends and family will enjoy. Similarly, store owners can benefit from a smaller number of returns in the months after the holidays.

Nexus: G-WEBCD1