Rise of the Restaurant: Dining Out is back IN (thanks to gift cards)
By Alethea Price, Marketing and Public Relations Manager
The past two years have challenged us all, and the restaurant industry certainly was put through its paces. Unable to open their doors for much of 2020 the future of eating out was unknown, meanwhile, quick service takeaway restaurants took off providing the only dining experience we could access in turbulent times.
One tool offering a lifeline was the gift card – providing restaurants with a well-needed injection of cash, helping to stimulate the economy, while also offering loyal and new sit-in guests the hope of future use. Gift card sales, much like everything else took a hit as we adjusted to the new norm, but while they may not have returned to pre-pandemic figures, projections are good with gift card sales up 22% from 2020 and card loading spend remaining consistent across casual, family, and takeaway restaurants (Paytronix 2022). Fine dining has also enjoyed a 22% increase with an average load value of £86.29 ($113.69). Moving into 2022 digital gift card sales are also at a record high in 2021, showing an eagerness to return, with 55% of gift card purchasers expressing a specific interest in gift cards for local restaurants (Fiserv 2021).
Why such an interest now? Restaurants present a unique offering where friends and family can come together to enjoy good food, great ambience and socialise which is a well-needed change after long stretches of solitude and anxious outings. Guests are returning in force which is great news for restaurants and gift card sales alike, but with changing times are also changing expectations. Returning guests are looking for more than just good food, but an effortless experience and a thoughtful service with enriched touchpoints and indulgent experiences. This has led to a rise in customer experience innovation in retail and restaurants alike and gift cards are no exception. Examples include scheduled delivery, fully customizable digital gift cards and more appealing and engaging packaging design among restaurant chains and high-level brands.
This supports recent reports from Fiserv (Dec 2021), indicating that despite the rise of digital gift cards during the pandemic, the physical gift card is still preferred by more than half of consumers (54%). Those figures are very similar to those in 2019, indicating strong retention year over year. Findings also show that physical gift cards are favoured by both purchasers and receivers, although purchasers show a particular preference for the physical because it retains that sense of a traditional gift-giving experience, while 80% of consumers also say they feel satisfied receiving a gift card.
While some prefer digital offerings for the immediate delivery, and ease of sending this was primarily by those purchasing for self-use – often associated with other benefits such as loyalty points, and discounts – while those who opt for physical gift cards favour them for their tangible nature, ease of giving and use, and the sense of something physical to unwrap.
In that vein, it is also interesting to see that although gift card purchasers don’t show particular interest in card design itself – suggesting they would purchase a card regardless of their likeness for the card – Fiserv’s research shows that gift card packaging plays an important role. With over 1000 participants suggesting that they are more likely to purchase a more attractive gift card carrier design, and 56% agreeing that an attractive carrier eliminates the need to purchase a separate greeting card to accompany the gift, beautifully designed packaging creates a 2-in-1 gift and the opportunity to focus all spend on gift card loading – great news again for restaurant owners.
It looks like while times have been tough, the future of restaurant gift cards is good, and with dining back on the cards now is the moment to invest in a gift card and loyalty solution with creative design and customer experience at its heart.
One last note to leave you with…
Did you know: Restaurants that leverage gift card offerings average 88% more profits than restaurants that don’t. Not only do 80% of redeemers spend more than the gift card value, but by gifting gift cards to others, loyal guests also expand the reach of your restaurant to a new audience creating a well-balanced growth-retention strategy.