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September/October 2013 Issue

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How I Learned to Love Gift Certificates

My $18,000 Mistake

By Eric Brown
[Feature]

If you want to dramatically increase your gift certificate sales and overall revenue, read this article.

I first realized the power of gift certificates thanks to a call I got from the city of Toronto. City Hall managers wanted to give a year-end bonus to the staff. They needed to spend the rest of their budget, so they asked me how much it would cost to buy 300 gift certificates. 

This was a big deal for me. It would have been an $18,000 sale, assuming each certificate was $60—the price of my one-hour massages. I wasn’t working at capacity at that time; I had approximately 300 active client files, so getting 300 new clients would have doubled my business. Needless to say, this sale would have been a major coup. 

The managers wanted a good deal, but I didn’t really feel I could afford to discount. After some internal debate, I did provide a discount, but it was a relatively minor one. I submitted my offer, and over the next few days, I sat by the phone waiting for good news. 

Unfortunately, I didn’t get the sale, but the experience woke me up and got me thinking about using gift certificates as a way to build my practice. Until then, my gift certificates were probably where your gift certificates are—in some office drawer. I would sell the odd one, usually when somebody requested it specifically. But from that moment on, I really started promoting gift certificates and analyzing my gift certificate sales. What I discovered was nothing less than astounding. 

If I had discounted sharply to close the deal with City Hall, I would have brought in dozens of clients who might have bought over and over again, which could have resulted in tens of thousands of dollars in sales over time. I could have even included an offer to upgrade, which would have increased my initial sale value. How? Let me explain.

The Holy Grail of Marketing

Gift certificates are one of the most powerful referral-generating tools you can possibly use in your practice. For me, it’s been the number two method of getting new clients into my clinics, behind referrals. When someone buys a massage gift certificate for a friend, colleague, or family member, she is referring someone to you and endorsing you specifically. And she’s also paying for that person to come in. This eliminates price as an objection for the prospective client, making it really easy to take action and try your services.

There are not a lot of businesses where existing customers pay to send you new customers. Imagine a friend saying this to you: “Susie, you just have to go see my mechanic. I love this guy. He’s amazing. He’s so great that I got you this gift certificate for a tune-up and tire rotation.” That just doesn’t happen. In this respect, massage is in a league of its own. It’s also likely that this new client is going to have the same traits or characteristics as your existing client, simply because people hang out with others who share the same interests, the same values, and the same income bracket. These new clients may be like clones of your existing clients, and therefore be predisposed to use your services regularly. 

If that’s not reason enough to dust off your gift certificates, consider this: getting a new client through a gift certificate really costs nothing beyond the cost of the certificate itself. 

I think a lot of massage professionals or bodyworkers believe you can get new customers for free. You can’t! There’s always some acquisition cost; it’s unavoidable. Let’s say you run an ad and it costs you $600, and let’s assume you see 10 new clients from that promotion. You essentially bought 10 new clients at $60 each. That’s your client-acquisition cost.

With gift certificates, there’s really no acquisition cost beyond the cost of the gift certificate itself, and gift certificates are relatively inexpensive. ABMP members can find gift certificates online by visiting the Members section at www.abmp.com, and can also add gift certificate functionality to a website at www.thegiftcardcafe.com. Some other gift certificate resources include Bodyworkbiz.com, CellCharge.com Full Slate, LocalGiftCards.com, MindBodyOnline.com, and Natural Touch Marketing.  

Maximize Your Redemption Rate

To benefit most from your gift certificate sales, you’ll want to maximize your redemption rate. The redemption rate for massage therapy gift certificates at my clinics has ranged from 10–90 percent. As a result, I have identified some of the factors that make a new client more likely to use his gift certificate—and become a regular client. 

Generally speaking, the higher quality gift certificate used, the higher the redemption rate. I once used an oversized, color gift certificate on beautiful, textured paper that came in a decorative holder. We got close to a 90 percent redemption rate on those. When we sold our existing customers gift certificates with just black ink on colored stock paper, we found our redemption rate dropped significantly, to about 50 percent. I’ve also had black and white gift certificates with a redemption rate of only 10 percent.

I would suggest you always indicate an expiration date on the certificate, otherwise customers will hang on to them for a long time and still want you to honor them. If it is not legal in your state to place expiration dates on your certificates, simply suggest a time frame, for example, “Please enjoy before June 1, 2014.” 

During another gift certificate promotion, I said to clients, “January and February are my slowest months of the year, so I’d love to provide you with a great holiday or Christmas gift for your colleagues, family, and friends—and it helps me out at the same time.”

I told my clients the truth of my situation; being honest with people is the best way to market your practice. Here was my proposal: “I’m going to discount my gift certificates significantly. However, there are two conditions. First, these are for people who haven’t been into the clinic before. Second, the certificates will have a two-month expiration date, instead of my normal one-year expiration date.”

The first time I ran this promotion I sold literally hundreds of half-hour gift certificates because it was a fabulous deal for my existing customers. They wanted to introduce people to the benefits of massage, and this was a really cheap way for them to do it. Plus, these were all redeemed in January and February, a time when I traditionally had a significant amount of downtime. Instead, I was busy seeing new customers I could convert into regulars. 

What this means for you is that you can control certain variables and use gift certificates for a whole range of purposes, depending on what your needs are at the time. 

For example, if you want to get lots of new clients in the door and there’s a high possibility of repeat sales, you can discount the certificates to sell as many as possible and get lots of people into the buying cycle. If you’re quite busy and you just want to increase your transaction value, focus on selling gift certificates at your usual fee.

Selling Gift Certificates in Bulk

My experience with City Hall came about by accident, but you can make large sales like this happen by design. You can sell associations, corporations, and organizations on the idea of buying gift certificates in bulk.

One of the easiest places to start is with local businesses. Almost every business does some form of gift giving, whether for a customer appreciation event or for staff, and gift certificates make it really easy for the business to work with you. 

Sell half-hour gift certificates and discount the price significantly. Clearly print any conditions that you require on the gift certificate. For example, “For first-time clients only. One certificate per client. Can be upgraded to a one-hour massage for just $30.”

If you are approaching larger corporations, the process will likely start with a sales letter. At left is an example of a letter that can really help you make that sale.

Don’t underestimate trusty gift certificates. They are marketing dynamite, and can explode your sales. Make an effort to put as many of these ideas into practice as you can, and aim to sell 300 gift certificates within the year.  

 Eric Brown is a frequent Massage & Bodywork contributor. Learn more about him and his work at www.bodyworkbiz.com.

11 Ideas to Sell More
Gift Certificates

There are lots of ways to increase gift certificate sales within your practice. Here are 11 ideas to consider: 

Piggyback on holidays 

The holidays are fabulous opportunities for gift certificate promotions, Christmas and Hanukkah in particular. Valentine’s Day, Mother’s Day, and Father’s Day are also big gift certificate holidays. Plan promotions around each of those, and launch your campaigns at least six weeks before the date. 

Make gift certificates visible 

Create a little display at your reception desk. Place one of your gift certificates in a holder and have a little sign that says something like, “Massage is a unique and healthy gift. Buy gift certificates for your friends and family here.” 

Use signage to raise awareness 

An excellent place to post signs promoting your gift certificates is just inside the treatment room door. It’s the last spot people see as they leave your treatment room and come to the reception desk with their credit card or checkbook in hand. 

Remind clients in person 

Find out who’s left on their holiday shopping list and then ask if they’ve considered massage certificates as gifts. It doesn’t have to be a hard sell. Again, you’re just reminding them that these are available.

Send out last-minute reminders 

Gift certificates make great last-minute gifts because they are so easy to buy. Your clients can just give you a call and you can either send the certificate to them or to the recipients by snail mail, or by email for immediate gift giving.

Give an incentive for buying 

For greater sales, make sure there is something in it for the purchaser. There are all kinds of possibilities here. You could offer a 15-minute upgrade that can be used by the purchaser, or a free session for buying a minimum quantity of gift certificates. You could provide a premium, like a paraffin treatment, hot towels, a body scrub, or whatever value-added service you have. 

Send a promotional letter 

Get a list of all your clients, both active and inactive, and make them aware of the fact that they can buy gift certificates from you. In the letter, emphasize how stressful holiday shopping can be and outline how easy it is to do it with gift certificates. You can arrange to make the sale over the phone and mail the gift certificates so shoppers don’t even have to leave their home. If you don’t accept credit cards, have buyers drop a check in the mail. 

Offer to upgrade the certificate 

Whenever any half-hour gift certificate is redeemed, all you have to say when the person is on the phone making their appointment is, “Would you like to upgrade that to a full hour for only $30 more?” I’ve found through testing that about 80 percent of redeemers will take advantage of your upgrade offer. If you look at it from their perspective, they’re paying $30 and getting an hour massage—a great bargain—so it makes sense for them to upgrade while they have the opportunity.

Emphasize shorter time frames 

Instead of selling one-hour certificates, just sell half-hour certificates. The unit price is lower so it seems less expensive. As a result, people are more likely to buy more, which will bump your overall sales.

Use high-quality
gift certificates
 

Go for full-color printing. If available, buy oversized certificates rather than small ones. These factors increase the certificate’s perceived value. 

Track your results

Record the number of gift certificates you sell and note how many were redeemed and upgraded. I’d also suggest tracking how many redeemers booked a second appointment, and the ongoing sales totals for those clients. This will allow you to refine your promotions and make them even more profitable the next time around.

November 2, 2013

Give your employees more than a pat on the back—give them a massage!

Attention: Business owners, office managers, and HR directors

Here’s an inexpensive way to reward your employees, show you care, and boost morale. Your employees are the backbone of your business, and I’d like to help you reward them.

For a brief time, My Massage is offering incredibly low-cost massage for your employees. Just because massage seems like a luxury gift, doesn’t mean it has to cost a lot. For as little as $5 per employee, you can offer them a gift that they’ll absolutely love you for.

Why are we charging so little when other clinics charge up to 1,000% more for the same service? Because our motto is “Prove your worth first!”

We know a significant number of your employees will benefit in such a big way that they’ll come back again and again. And we know that once you see the impact this has on your company, you’ll be more than willing to pay our full fee the next time around.

What’s the catch? There is none. You get a great, inexpensive way to reward your people and boost morale, and we get to introduce the benefits of massage to your employees. We all win.

We are so confident, we’ll even offer you a 100% money-back satisfaction guarantee. If you are not completely delighted, we’ll return every cent you’ve paid, no questions asked.

Please give me a call at 123-4567 for more information, or visit www.mymassagewebsite.com. I know you’re busy; if I don’t hear back, I’ll call to give you all the details. This offer is valid until November 30—it’s important to move on this soon.

Take care,

Mary

My Massage

www.mymassagewebsite.com

P.S. Want to look like a hero to your best customers and get them spreading the word about you? At this low price, why not give them a massage, too?

To read this article in our digital issue, click here.



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