How gift cards turn into future visits with Smeetz

Leisure venues have vastly different admissions figures from month to month. Demand is high during certain holidays or seasons, but low at other times of year. The "busy seasons" vary from venue to venue and place to place. For many, the Christmas and New Year holidays, summer school holidays, or national holidays are often extremely busy. People are off work and school, and ticket sales and tourism revenue experience a big boost. 

At other times of year, business slows down for leisure and events venues. Venue owners and managers can plan ahead for these waves in theirre venue and cash flow planning. However, they can also use gift cards strategically to bring additional visitors and revenue to the slower times. This article explains how this strategy works. 

The concept of deferred revenue

Gift cards are deferred revenue for leisure venues. The venue earns cash from the card sales, but they still owe the customers the experience. An effective way to handle this dynamic is to not count the gift card revenue until the cardholder visits. Until then, the revenue is promised, but not yet realised. 

Here's an example. If someone buys a $100 gift card as a birthday gift for a friend, that $100 is deferred revenue until the card is redeemed. If there is a partial redemption, the actual revenue is only the amount redeemed. If a cardholder with the $100 gift card uses $60 for a visit to an amusement park, the revenue is $60, and the remaining $40 stays as deferred revenue until it is also redeemed. As we will explain, there are strategies to help avoid partial redemption and to inspire cardholders to redeem their gifts so that it does not remain as deferred revenue for a long time. 

The concept of deferred revenue is important for helping to smooth out the difference between peak seasons and slow months.

Managing gift cards

The Christmas gift giving season provides an example of how venues can accomplish the smoothing between high and low seasons. People buy Christmas gift cards (deferred revenue) to give during the season, but the venues can use pricing promotions or other strategies to get card-holders to redeem their cards (actual revenue) soon after they receive them. 

A system like Smeetz, which allows customisation of gift cards and parameters for redemption, can help venues inspire low-season visits from gift card holders.

Omnichannel sales and redemption

The first step in the process is to get people to buy cards. Smeetz ensures gift cards are accessible. People need the option to purchase experience gift cards online, via a ticketing kiosk, or in person at the venue. Venues should offer both physical and virtual gift cards that can be delivered by email or text.

At Smeetz, our omnichannel ticketing makes it possible to create and sell gift cards on a website and from self-service kiosks or point-of-sale counters.

Customers can also use all these channels to redeem gift cards for admissions, reservations, tickets, or other items.

Meanwhile, venues can place parameters on gift cards, such as creating a period of validity. This ensures gift cards will be redeemed within a reasonable period; otherwise, they become invalid and can be counted as actual revenue.

Venues can allow customers to extend the validity period by paying an additional fee.

Gift cards and leisure demand management

Gift cards can be an important part of demand-smoothing efforts.

Demand smoothing involves using pricing, promotions, and other strategies to bring guests into the venue during slow times of year.

There are several ways to inspire people to redeem gift cards at certain times:

•          Set the expiration date before the next busy season.

•          Off bonus value for gift cards redeemed during off-peak times.

•          Lower admission prices for non-busy times of year.

•          Offer gift card registration to obtain emails for gift card holders to use for promotional offers.

Not only does leisure demand management smooth the difference between peak and non-peak visits, but it also helps convert deferred revenue into actual revenue for gift cards.

Extending gift card value

Gift cards are more than a tool for earning additional revenue.  They can serve as tools for extending value and creating customer loyalty.

There are several options for venues to unlock additional value:

•          Use gift cards for more than admission. Let holders redeem them for an upgrade, special service, a premium visitor experience, or extended time inside the venue. This provides extra value to customers and can create loyalty. It also encourages full redemption, so venues don't have to deal with partially used gift cards and extended deferred revenue.

•          Offer gift-card-specific perks. These extras could include access to pre-sale tickets or a special line for early entry to the venue. Again, these perks don't cost the venue anything extra but add to the perceived value.

•          Upsell during redemption. Offer additional deals on food and beverage packages, merchandise, or VIP/premium experiences. These upsells can be effective because the gift card user isn't spending any of their own money on their initial purchase, so the add-ons may seem more affordable and worthwhile.

•          Sell experiences forholidays or special occasions. For instance, offer packages for birthdays or holidays that happen during times of low seasonal demand. For instance, if February is a slow month, a venue can offer a special Valentine's Day experience for gift card holders. 

•          Allow redemption for memberships. Members might get a certain number of admissions per month or year. Gift cards for memberships can build loyalty and get the venue lifelong customers. Since it's a gift card, the user might consider it like a trial membership. If the venue impresses them during this time, they may renew their membership.

These strategies rely on the experience economy. By offering perks, upselling, and adding value, venues can get additional revenue, build loyalty, and encourage gift card users to redeem their cards quickly.

Using AI to plan promotions and extend gift card value

Smeetz's unified commerce platform uses existing ticketing and attendance data to forecast ticket sales and admissions. This can help with demand smoothing and provide insights to help with pricing, promotions, and special offers for gift cardholders.

Meanwhile, our Atlas AI chatbot can assist with both customer service and marketing. For instance, it can help customers purchase an extension that lengthens the period of validity for the gift card. The extension fee brings extra revenue, and it also ensures the cardholder feels invested and will be more likely to use their gift rather than letting it lapse.

Atlas AI can manage as many as 30% of customer interactions without human intervention. This means that your staff won't get bogged down with gift card questions and concerns. The chatbot can also provide information about special deals and promotions that get gift card users to redeem their cards quickly.

Master gift card sales and management with Smeetz

With the unified commerce platforms from Smeetz, it's possible for venues to design and customise gift cards to meet their exact needs and strategies. Our omnichannel sales options make the cards accessible to buyers and easy to redeem. Venue managers can upsell, make special offers, and get the most revenue and value out of their gift cards.

Curious how giftcards can bring more business during the slower times of year? Book a demo to explore how Smeetz supports gift card management.