The end of the financial year (EOFY) is a significant period for businesses worldwide. It marks the conclusion of a financial cycle and offers an opportunity for companies to evaluate their performance, analyse financial data, and make important decisions for the year ahead. One popular practice during this time is the implementation of an EOFY corporate gift card program.
This program involves distributing gift cards to employees, clients, or partners as a token of appreciation for their contributions and support. But how and more importantly, why does it work? In this article, we will delve into the details and explore the reasons behind its effectiveness.
To understand how an EOFY corporate gift card program works, we first need to explore the mechanics of gift cards themselves. Gift cards are prepaid cards issued by a company, typically in a specific denomination or value, which can be used to make purchases within a designated network of affiliated merchants.
These cards can be physical or digital, depending on the requirements of the company. Companies can purchase gift cards in bulk from various retailers or work with specialised providers that offer a wide range of brands and options.
Now, let's examine the key steps involved in implementing a corporate gift card program:
1. Objective Setting: Companies initiate an EOFY corporate gift card program with specific objectives in mind. These objectives could include recognising and rewarding employee performance, fostering client relationships, or expressing gratitude to partners and suppliers.
By defining clear goals, businesses can tailor their program to effectively meet the desired outcomes.
2. Budgeting: Allocating a budget for the gift card program is essential. Companies need to determine the total amount they are willing to invest in gift cards and associated expenses such as administration, distribution, and fees charged by gift card providers.
By setting a budget, businesses can ensure the program remains financially feasible and aligns with their overall financial strategy.
3. Gift Card Selection: The next step involves choosing the type of gift cards to distribute. Companies can opt for general-purpose gift cards, which are accepted at a wide range of retailers, or select cards specific to certain industries or interests. The choice of gift cards should reflect the preferences and demographics of the recipients, enhancing their relevance and appeal.
4. Distribution: Once the gift cards are acquired, they need to be distributed to the intended recipients. This can be done through various means, such as physical delivery, email, or mobile applications. Companies may choose to distribute the cards directly or organise events where employees, clients, or partners can collect their gift cards. Efficient and timely distribution is crucial to maximise the impact and effectiveness of the program.
5. Communication: Effective communication plays a vital role in the success of an EOFY corporate gift card program. Companies should clearly articulate the purpose of the program, express their appreciation, and explain the process of redeeming the gift cards. This communication can take the form of email announcements, internal memos, or personalised messages accompanying the gift cards.
6. Redemption and Reporting: Recipients can redeem their gift cards by using them to make purchases at participating retailers. Companies should ensure the redemption process is straightforward and user-friendly. Additionally, it is important to track the utilisation of gift cards and gather data on how they are being redeemed. This information can provide valuable insights into recipient preferences and help optimise future gift card programs.
Learn more about corporate gifting - Enforcing company values with Australian gift cards
Now that we understand how a corporate gift card program works, let's explore why it is an effective strategy for businesses. Here are some key reasons why businesses choose to implement a corporate gift card program for the end of financial year:
1. Employee Rewards and Recognition: The EOFY presents an ideal opportunity for companies to express gratitude and recognise the contributions of their employees, clients, and partners. A gift card program allows businesses to acknowledge the hard work, dedication, and achievements of individuals or teams throughout the year.
By showing appreciation, companies can boost morale, foster loyalty, and enhance the overall employee experience.
2. Motivation and Incentives: An EOFY corporate gift card program can serve as a motivational tool. By offering gift cards as rewards, companies can incentivise employees to achieve specific goals, targets, or milestones. Recognising exceptional performance with a tangible reward can inspire employees to go the extra mile, improving productivity, and driving business results.
3. Retention and Engagement: Employee retention is crucial for the long-term success of any organisation. A well-executed EOFY gift card program can contribute to employee engagement and retention efforts. By demonstrating that their efforts are valued, companies can increase employee satisfaction and loyalty. Gift cards provide employees with the freedom to choose rewards that align with their personal preferences, making the gesture more meaningful and memorable.
4. Relationship Building: For businesses, maintaining strong relationships with clients, customers, and partners is essential. An EOFY corporate gift card program allows companies to express appreciation to these external stakeholders, reinforcing positive relationships and fostering goodwill. By offering a token of gratitude, companies can strengthen connections, encourage repeat business, and position themselves favourably in the minds of their clients and partners.
5. Brand Awareness and Promotion: Digital and physical gift cards can also be an effective marketing and branding tool. By partnering with popular retailers or brands, companies can leverage the association to enhance their own brand image. Gift cards carrying the company's logo or branding elements can serve as subtle reminders of the company's products or services, reinforcing brand recall and awareness.
6. Tax and Financial Considerations: From a financial standpoint, a gift card program for the end of financial year can offer tax benefits for businesses. Depending on the jurisdiction and applicable tax laws, companies may be able to claim tax deductions for gift cards given to employees or clients. It is crucial to consult with tax professionals or accountants to understand the specific regulations and requirements.
7. Boosting Sales and Revenue: In most industries, a gift card program can help drive sales as the end of financial year nears. Typically, through some sort of cashback program that incentivises higher volume spending.
8. Flexibility and Choice: Gift cards offer recipients the flexibility to choose products or services according to their personal preferences. This ensures that the gift has intrinsic value and is more likely to be utilised. By allowing recipients to select from a variety of retailers and brands, companies can cater to diverse tastes and interests, increasing the chances of a positive impact.
The choice of the type of best digital gift card and gift card provider is one that is often left to the very last minute. On top of that stressor, being able to offer your customers and employees sufficient options to keep them satisfied has to be kept at the forefront of the mind. That’s where GIFTA comes in!
Let us support your business in running your corporate gift card program.
Customise corporate gift cards–both physical and digital, at no cost with GIFTA. More than that, recipients can swap for any of the hundreds of brands of their choosing. Don’t miss out on treating your team and customers before the EOFY date of Friday, 30th June 2023.