In keeping with the varied and changing gastronomic behavior of consumers, restaurant brands ?in India have embraced new ways and means to reach out to their patrons, guests and consumers more effectively. The restaurant chains are powering CRM Programs blended with innovative Prepaid & Gift Card Programs ? launched across their ecosystem of outlets, office premises and online properties.
By adopting acohesive & innovative approaches to reach their base of growing consumers, the brands are driving better bang for their marketing buck.
The Indian consumers have seen their preferred brands across consumption segments launching a slew of initiatives in the Gift Card segment ? across department stores, fashion accessories, premium personal accessories, hypermarkets, grocery, cinema and entertainment, and travel segments. More than 4 million physical Gift Cards & digital Gift Cards have been issued and activated across the Indian organized retail segment in the last 2 years.
In particular, the Dining &Restaurant brands & retailers that have scaled their business operations successfully have also been increasingly adopting the Prepaid category and have made their Gift Card Portfolio an intrinsic success factor in their business menu.
Ardent fans of Caf? Coffee Day, India?s largest chain of Cafes have embraced the Caf? Moments Card Program that has been launched across all the 1400+ Cafes in India. This Caf? Moments Program is the largest program that has been launched in the Prepaid Gift Card segment by the sheer number of locations that it has been successfully launched by the Caf? Coffee Day brand.
On the premium dining formats, India?s popular chain, Blue Foods, has launched the Blue Foods Gift Card Program recently. As the CEO of Blue Foods, Mr. KS Narayanan, commented “Bluefoods has consistently strived to provide a great dining experience to all its guests through its various restaurant brands in Spaghetti Kitchen, Copper Chimney, Noodle Bar, Bombay Blue, Coffee Bean & Tea Leaf in multiple locations in different cities and is today one of the leading players in the Restaurant and Cafe space. Addressing the need for a Gift card for our valued guests who can use it across any of the restaurant brands in the cities of Mumbai, Delhi, Gurgaon, Bangalore, Kolkata, Chandigarh, Pune, Chennai, Bluefoods hopes to reach a larger audience with this fantastic product”.
Depending on the business needs, the restaurant brands have selected the most appropriate Technology platform and program features that best fit their individual business. Adapting alternative ways of promoting and sellingGift ?cardsis always important and has enabled the retailers to create the needed differentiation from their competition.
Top Ten Benefits for Restaurant brands.
There are many benefits to brands & restaurants that have implemented these innovative Gift Card systems.
Below is a list of benefitsthat brands have witnessed after launching a gift card program. Results dovary depending on the segment, consumer base and the local demographics& psychographics addressed by the chains.
1. Driving Higher Sales
The sale of the Chai Point Gift card itself immediately generates Prepaid committed future business revenue for the fast growing startup chain that has been driving Tea consumption with their Chai Point branded outlets in India. At the time of redemption or usage of the Gift Card by the recipient, the revenue generated can be as much as 50%? – 80%? higher than the Gift Card value (Sales Uplift).
2. Breakage and working capital
The retailer gets critically important working capital for cash flow. Allows the brands to use the upfront cash received to expand and grow business.Unredeemed amounts on the Gift Cards? are witnessed across brands. In most categories, the breakage aid in funding the entire programs though brands enable their patrons & consumers to revalidate the Gift Cards on specific scenarios.
3. Store audits – fraud & pilferage
Realtime transactions tracking and technology enabled systems have helped the brands to reduce and also prevent fraud and theft. The Gift Card Systems have additional security features to help control users and clerks. These technology features eliminate the potential of duplicate cards from being issued.
4. Ease of use and faster transactions
? Helps speed up transactions at the point of sale.
? Processing gift cards is similar to a credit card transaction.
? Less steps at the point of sale increases sales and efficiencies
5. Eliminates manual bookkeeping
The?online reporting systems provides ?reconciliation reports and business relevant data that saves lots of time with tracking and reporting total outstanding liability on their programs. ?This makes the entire process more effective for a nationally spread chain like Blue Foods.
6. Low cost of entry
Considering how the Gift Card Technology &systems help to streamline business operations and tracking, many brands & retailers? have been able to improve operational efficiencies by over 30% on launching their Prepaid programs.The Gift Card solutions are available on a partner mode than on a Capex mode. This enabled even smaller brands at a startup stage of their operations to adopt the Gift Card category for their Portfolio. This has enabled even startup QSRs like Chai Point or large chains like CCD to adopt and make their Prepaid Programs drive higher ROIs quickly.
7. Attract new customers
The Gift Card programenables the restaurants to get two consumers with a single product ? the consumer buying the Gift Card; and the consumer using the Gift Cards. This helps to promote their multiple formats and brands like Spaghetti Kitchen, Copper Chimney, Noodle Bar, Bombay Blue, Coffee Bean & Tea Leaf? with? one common universal Gift Card; ?helping to convert ?one-time buyers into lifetimecustomers.Cards that have been received as gifts typically draw in customers to the location thatwould have never otherwise visited or experienced the specific location of the restaurant.
8. Higher Ticket Prices
Average ticket prices on gift card transactions are 50% to 150% higher? current usage trends show that patrons ?spend, on average, 60% more than the value of their Restaurant card. This enables to promote higher-than-normal ticket sizes for outlets.
9. Promotes impulse purchases
Cards are often bought as an impulse purchase at the Restaurant locations that otherwise would not have occurred. After a good dining experience, the patrons are encouraged to purchase Gift Cards for their next visit or for gifting to any of their friends and family. The likelihood of this purchase by guests is seen to be higher when proposed at the time of dining at the restaurant itself. Customers? tend to buy cards that are promoted at the point of dining or sale.Offering cards solves last-minute gift ideas for customers that don?t have the time toshop.? This can be the ?perfect gift? for loved ones who have no idea what to purchase.
10. Helps manage donations, sponsorships and charitable contributions
Tracking sponsorship and charity investments separately from gift cards help restaurants ?with ongoing sponsorships and social &charitable offerings.By issuing these cards, merchants can utilize the marketing efforts of local sponsorships in their communities.
In keeping with the above benefits, brands have launched variants of their versatile innovations:
1. Technology powered? Physical Gift Card
The Blue Foods electronic gift card has replaced the traditional paper-based Gift Vouchers. These Gift Cards are activated with a prepaid balance and may be used multiple times until the original balance is depleted or reloaded by the bearer.
2. Corporate Card Program
The Corporate Gift Cards have replaced the paper voucher systems that were previously? used for business-to-business transactions. This has enabled the brands to productise their services and experience to the institutions in a far more effective way.
3. Employee Incentive Card:
Incentive Gift cards are mainly used by corporates to reward employees who meet specific criteria. The restaurant Gift Cards are growing popular for this to their Feel-Good factor associated with premium dining experiences. The incentive Value may be added at any time for additional incentives. The PVR BluO Gift Card Program has enabled corporates to gift their employees a novel experience of dining and bowing at the BluO locations in India.
4. Retail Gift Cards -Credit
Gift Cards are issued in place of a Cash refund or Credit Notes, to provide an in-store credit;? or to provide an incentive with Thank You Cards for customers to visit the brand stores in specific locations as required and planned by the brand teams. This process enables the brand owners or their franchisees to retain the money without having to give cash back on returned products or merchandise items. The management would have a separate tracking process for their outlets and franchisees? so they can report on returned products & give the needed flexibility instantly to their consumers to remain associated with the brand.
5. Digital Gift Cards ( Mobile & Virtual Gift Cards)
This Program has enabled Instant delivery to the recipients for last minute fulfillment of gifting needs. Restaurant brands see this as a means to leverage the potential of social media engagements and online commerce to be extended to drive footfalls into their own premises.
The Caf? Moments Card has been launched in its virtual form to drive sales and footfalls of the CCD ecommerce site, thereby leveraging the brand strength to grow their online business too.
With the plethora of benefits and programs witnessed, the Indian consumer would increasingly be able to indulge in her favourite dining experiences in novel modes of engagements over the next year.?
By T.P Pratap, CMO and Co-Founder, Qwikcilver Solutions
