How to Get the Most Impact out of Store Credit
Store credit is a terrific marketing tool as well as a cost-effective way for any retail organization to deal with returns. This approach not only improves client retention but also improves brand loyalty. With that in mind, today's post will provide you with numerous useful pointers for maximizing the value of shop credit.
What is it?
Customers can exchange store credit for other items of equal value when they return an item to a retailer. Retailers have come up with creative ways to provide store credits in a variety of formats in recent years. As a result, shop credit policies varied amongst retailers.
Declaring that you have a purchasing policy that allows your customers to seek a refund on their credit cards if they provide a receipt. Instead of a complete cash refund, you may provide shop credits in the same amount, which customers can use on future purchases. Your shoppers will only charge the difference if the goods are worth more.
Store credit types
1. Returns and exchanges
A sales associate might provide store credits to customers who want to return things that do not match their expectations. This buying policy can also be used when customers wish to swap things that are incorrect or defective. Store credits are worth exactly the same as the money spent on the returned or exchanged items, so salespeople should remember that.
2. Gift cards
People spend time choosing the best gifts for loved ones on special occasions such as birthdays or wedding anniversaries. When it comes to giving friends and family members plenty of purchases from their favorite businesses, gift cards are one of the best options.
Why store credit?
The main advantage of this purchasing method is that shops do not lose money on returns. Instead of a complete cash refund, store owners might offer customers an equal-value swap for other things. Store credit not only keeps money in the firm but also increases sales.
Customers think of firms as being flexible when it comes to returning policies. Purchasers will have an extra choice and a longer period of time to return items. Store credits are a great approach for retaining consumers. Store credit not only provides customers an extra reason to return, but it also allows the retailer a second chance to impress its customers and steadily create customer retention.
According to a GE Capital research, when firms provide a branded credit card, in-store consumer visits increase by 29%. (a type of store credit). In other words, store credit has been shown to encourage customers to visit the store more frequently. Furthermore, when shoppers are lured by other things inside the store, they have a tendency to spend more than their store credit. Retailers who take advantage of this opportunity will be able to increase sales.
How to optimize store credit for your online store
1. Transparent policy
According to Invesp data, 67 percent of buyers look at the return page before buying something. As a result, each retail firm must have a clear and customer-centric return policy.
Store credit, on the other hand, is a positive in a variety of ways that shoppers may return unsatisfactory purchases. Shop owners must, however, define what products are branded as "final-sale," which items may be purchased with store credit, and when items can be returned (30, 60, or 90 days).
2. Sharable store credits
Flexible policies are critical for establishing the desired brand image in the eyes of customers. Allow your customers to share store credits with their friends and family members in addition to using their balance to pay for other things.
It should be simple to make payments using shared shop credits if they visit physical stores with their partners. Customers who want to transfer their shop credits, on the other hand, may be required to provide the recipient's email address as well as the amount.
3. Reward points for using store credits
Given the foregoing, this buying strategy provides a slew of benefits for shops, particularly in terms of increasing sales. As a result, companies should provide financial incentives for customers to utilize it.
Customers are more likely to prefer cash than store credit in most cases. Salespeople could offer incentives, such as 20 points for returning shop credits rather than cash and 10 points for using them to make a payment.
To put it in a nutshell
After evaluating 11,000 businesses across the United States, the University of Texas research concluded that a permissive return policy resulted in increased sales. As a result, retailers might try to employ store credits, which allow shoppers to return and exchange products more easily. This buying strategy, on the other hand, helps company owners retain customers, increase sales, and build a strong brand image.
Store credit for rewards, refunds, returns, and exchanges. Keep the money in the store when refunding.