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Gift Cards a Hot Item for Retailers

19 Nov, 2004 By: Holly J. Wagner

With marketing gurus extolling the virtues of gift cards this season, specialty chains are making sure they won't be left out in the cold.

Deloitte & Touche's annual holiday survey uncovered two things that should work in the favor of savvy retailers. One is that 64 percent of shoppers plan to buy gift cards, up from 60 percent last year.

“The increase in gift cards comes at the expense of such holiday-gift staples as apparel, CDs, DVDs, tapes and books,” according to Deloitte. Not if Blockbuster Video and Movie Gallery have anything to say about it.

“Gift cards are really at the heart of our plan for the holidays,” said Lisa Zoellner, Blockbuster SVP, general merchandise. “Our customers are really looking for easy gift solutions. We have developed convenient and compelling offers for the holidays.”

Gift cards are available year-round at both chains, but this year Blockbuster will put them in more areas around the store, and Movie Gallery will use added in-store signs to remind consumers the cards are available at checkout.

“The thing we do is use our in-store signage to convey the holiday message, and this year we are focusing on our discount cards,” said Ted Innes, SVP of marketing at Movie Gallery. Discount cards are good for movie or game rentals. The value proposition is $27 worth of rentals on a $20 card or $75 worth of rentals on a $50 card.

“We promote the rental card as a big item during the holidays. We focus around the hot titles that are coming out,” Innes said. “We don't spend a lot of money merchandising the stores for a holiday look.”

The chain also offers gift cards in $5, $10 or $25 denominations, with signs and shelftalkers to advertise them.

Presell the Customer
“We're trying to presell our customers while they are shopping. We want them to think about them as great gift ideas not only for family and friends but for themselves,” Innes said. “We've offered [gift cards] for the past four years, but most people go the discount card route because of the extra value.”

Both chains have proprietary movie images on their holiday gift cards. So, while each has a Shrek 2 card, the designs are unique to each chain.Deloitte also found that 66 percent of shoppers said they will shop at fewer retailers this year, which plays right into the Blockbuster strategy.

New this year is Blockbuster's Gift and Go holiday bag. It includes a $5 gift card, an assortment of candies, a holiday mug and popcorn wrapped with a bow, for $19.99.

For a more personalized gift, customers can build their own popcorn tubs stuffed with goodies, wrapped in special holiday wraps with space for a gift card on the outside.

“It is really taking all the tools, putting it together in one place,” Zoellner said. “In the past, they might have gone to another retailer for wraps and cards.”

Movie-themed popcorn canisters also have sleeves for gift cards this year. And for finishing touches, Blockbuster has addressable, tag-shaped $5 gift cards in packages of five.

The chain is also appealing to shoppers who plan to pick something up for themselves. For every $50 in gift cards, Blockbuster will give the customer an extra $5 card.

Finally, Blockbuster has gift cards for givers who want to give back: cards that benefit the Boys & Girls Clubs or the Susan G. Komen Foundation breast cancer charity, with donations based on card purchases.

Specialty chains won't be without competition for last-minute gifts this year. Even 7-Eleven is getting in on the act. The chain plans to offer top new movie and game releases, including Shrek 2, Spider-Man 2, Harry Potter and the Prisoner of Azkaban and the game smash Halo 2 through the holidays, stocking new titles on street date.

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