Gifting an experience
What is a gift voucher? A few years ago it might simply have been the paper book token tucked inside a child’s birthday card. These days, the gift voucher world encompasses prepaid plastic cards and electronic vouchers as well as the paper variety, and generates billions for companies in many industries.
The leisure and entertainment world has well and truly caught on, with museums, theme parks, hotels, spas and other attractions offering vouchers for one-off visits, or passes for a fixed period of time. Whether it’s the convenience of fixing a budget and ordering online, or the ability to gift a one-off experience to that person who has everything, consumers are driving a massive market.
But what do gift vouchers mean for merchants? What are the risks and challenges you should be aware of before opening up this potentially lucrative revenue stream?
Customer data protection
This should always be at the forefront of ecommerce merchants’ minds, but selling gift vouchers adds some new considerations. Are you giving customers the option to buy them over the phone? If so, a virtual terminal solution will be necessary. You might be emailing out electronic vouchers, but of course you must never request credit or debit card details over email.
Terms and conditions
Any website promoting or selling gift vouchers is required by law to publish terms and conditions that outline
- Minimum age and any other identification policies
- Validity dates
- Delivery information
- Details of how gift voucher payments will be published
These terms and conditions should also appear on any form of electronic voucher, or those that your customers can print at home.
Companies have come under fire in the past for not allowing customers to redeem gift vouchers when in administration. Whilst this is obviously a worst-case scenario it’s important to prepare for every eventuality. Gift vouchers should be accounted as deferred revenue and credited to a holding account until redeemed or expired. Revenue and redemption reports to manage gift voucher sales are highly recommended, with liability of revenue from unredeemed, valid vouchers recorded.