‘Use big discounts to attract voucher purchases’

By Emily Hawkins

- Last updated on GMT

Cash flow now: pub operators have said gift cards have helped them feel more confident about reopening
Cash flow now: pub operators have said gift cards have helped them feel more confident about reopening

Related tags Coronavirus

Publicans operating gift card schemes have said they are not worried that making sales now could mean they do not take more money when they are eventually able to reopen.

Many pubs have launched gift or loyalty card schemes during the closure period in order to garner cash flow now and guarantee future trade.

However, some readers said on social media they would not consider this for their business because it was a risk given some sites might not be able to reopen again and that, even if they did, it was a difficult financial model to use.

One said on Facebook: “I would be careful doing this as no one knows what is around the corner and [what] if your business doesn’t survive?”

Licensee John Tomkins has made tens of thousands of pounds by offering a range of gift cards to his regulars. He said he did not think this would mean a dent in his takings during the first few months after reopening because, with large families, a £100 voucher would not go very far and would encourage add-on spend for special occasions. 

He has been using the money to pay rent and staff who are still working on the site’s takeaway offer, in addition to making some interior improvements.

Pushing income

The operator said: “It’s all about pushing income when we haven’t got any. I’m really pleased with what’s happening at the moment.”

The pub is also offering deals on its seven bedrooms – with an offer of two nights for £99 – which Tomkins said has brought in between £5,000 and £6,000 so far.

He explained: “If people pay up front for things that they can’t use for a few months, they are going to want a benefit of that. I look at it as ‘if I discount at 50%, they will come in at special occasions and spend more and that will compensate for what we’re giving away’.”

A card offer should include an attractive discount to make it seem worth it to the consumer, Tomkins advised. He said many of his punters opted for the higher-price options. Six people had opted for a £1,000 option.

Some operators have found it harder to gain interest in gift card schemes.

Paul Garner, who runs the Yorkshire Grey, in Holborn, central London, said because his customer base is made of workers who commute into the city, it has been difficult to drum up income this way.

Future thinking

Unlike Tomkins, he is not spending the money from discounted drinks but rather “banking the money like a deposit” so that the pub can ensure it has funds to cover a slow increase in trade.

Garner explained: “As we are holding back the deposit [of cards sold], we are not worried about people just spending cards, it guarantees trade rather than having a quiet pub. We also want to do something for our community of workers to encourage them back to our safe venue.

“We have only seen a small interest in gift cards so far, but this is because a lot of customers have not returned to work yet – the gift cards we have sold have been purchased by companies organising drinks for teams once life becomes more safe.”

He suggested other operators should look to receive support from suppliers to offer incentives with voucher sales. Meantime Brewery has donated a prize of a brewery tour, which will be offered to someone who has purchased a voucher at random. 

Companies such as Toggle have helped pubs to organise their gift card offers while Budweiser’s Save Pub Life​ campaign has pledged it will double the amount a punter spends with a pub.

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