Hotel gift cards – an untapped goldmine

Gift cards are a 55 billion-dollar industry in the US (Wall Street Journal). No more the last-minute, last-resort gift option for that forgotten someone, gift cards are a practical choice for the time-conscious, cannot-bother-with-the-tinfoil-and-ribbon types! Is the appeal of gift cards limited to big-name retail brands or can hotels and travel companies tap into this goldmine?

The stumbling blocks for hotels:
The perceived value to the guest – A hotel gift card with low denomination would be less appealing to the recipient than a big-box retailer’s gift coupon for the same value.
Prior knowledge of the recipient’s taste and travelling habits – A $50 gift card for a luxury hotel is not exactly a budget traveller’s cup of tea
Research costs and fees: Unredeemed gift cards can lose value or incur extra charges. Do your homework.

A few ideas on reinventing the hotel gift card
– Treat the gift card as you would a business card. Have your company logo, website, brand mission on one side.
– Use the other side for a virtual tour of the hotel room or lobby or highlight your location – the city and its sights.
– Cross-sell and upsell: The gift card is a marketing medium with a shelf-life. Example: offer a half-price ticket to a top attraction for trying a new service.

Let the gift card do its job until it is redeemed and beyond that – it’s no longer a piece of plastic or that gift without a personal touch. It’s an opportunity to develop a life-long relationship with a new customer, regardless of the value of the card.

Published by

Vijay Dandapani

Co-founder and president of a New York based hotel company for 24 years. Grew the firm to five hotels in Manhattan and also developed a greenfield project at MacArthur airport, New York. Speaker at numerous prestigious forums including Economy Hotels World Asia, Lodging Conference, NYU, Columbia University Real Estate Roundtable, Baruch College's Zicklin School and ALIS. President and ceo of New York City Hotel Association since January 2017.

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