Data shows that when Think Local First gift card holders use cards at local merchants, they spend 34% more than the value of the card, explore new places, and value buying local.
Recent survey study findings show that $40K of CARES Act money used as bonus incentives in a “buy local” gift card program in Whatcom County resulted in high motivation to purchase cards, increased trial of new businesses, 34% additional spending on top of card funds, and is building to an 8:1 payback on the bonus. Bellingham Whatcom County Tourism and gift card platform Yiftee funded the Claremont McKenna College-administered card buyer survey focused on Whatcom’s campaign. Think Local First is an existing local promotion gift guide program from Sustainable Connections. The gift card aspect, coupled with a bonus dollars incentive, was added in late 2020 in conjunction with a county-wide collaboration of chambers of commerce, downtown organizations, and Bellingham Whatcom County Tourism.
The Program Being Studied
In an effort to help struggling retail shops and restaurants survive the 2020 holiday season during the pandemic, the county gift card coalition worked with Sustainable Connections to invite local businesses to participate. Whatcom County CARES Act money provided $40,000 in bonus incentives for buyers of these cards that could only be redeemed at locally owned Whatcom businesses. While incentive funds lasted, card purchasers in November and December of 2020 were awarded bonus cards of $10 or $25 in response to different levels of their own spending on cards. To date, 260 retailers accept the card, and 8,462 cards have been purchased with a value of $294,401 only redeemable at local businesses.
Data Shows More Than 30% Is Typically Spent Over the Card Value
In addition to the card’s value going directly to participating local businesses when spent, most customers spent additional money at retailers on top of the card funds—21% of respondents even spent 50% or more above the card’s value.
“The Whatcom County community has really rallied to help our small businesses and we are thrilled with the results,” said Sandy Ward, President and CEO of Bellingham Whatcom County Tourism Bureau, “not only did thousands of people feel inspired to buy local, they kept shopping above the value of the card.”
The survey data shows people spend 34% more than the value of the card, on average, for the purchased cards, and 31% more on the cards that were gained by the bonus funds promotion.
Benefits of the Bonus Incentive
Projections show that the return on bonus card investment is as high as $8 to $1. For every $1 in bonus card incentive money provided by Whatcom County via CARES Act dollars, up to $8 is tracking to be purchased and spent.
“We returned 2X our bonus card investment in the first month, and now we are at 4X with potential to double that to 8X as more cards are redeemed,” says Derek Long, Executive Director of Sustainable Connections.
Additionally, the incentive made a difference 18% of the time in inspiring folks to participate. While over 50% of survey respondents were motivated to purchase cards to help local businesses during the pandemic, the study found that 18% purchased gift cards because of the bonus.
More Than Half of Card Holders Tried Out New Shops or Restaurants
The survey found that 51% of card buyers tried new shops or restaurants with their Whatcom Think Local First cards, and cardholders liked being able to use them at multiple places around the county. The bonus program drew attention to the new Whatcom County program and the expiration of the bonus created a sense of urgency. While purchased card funds don’t expire, the bonus funds had to be used by December 31, 2020.
Ann Marie Cooper, Owner of Good Earth Pottery commented, “The gift card program definitely brought extra/new traffic to our shop. Several customers told me so. I know some local folks sent these gift cards to friends and family out of town, to bring their business to us/Whatcom County. The incentive program (bonus spending money) was big motivation for people to purchase the Think Local First Gift Cards… I am very thankful for the program.”
“Shopping local has always been popular but now it’s essential, and Community Cards are a simple way for consumers, companies and local governments to keep their local dollars local,” said Donna Novitsky, Yiftee CEO and co-founder.
Other Interesting Takeaways from the Survey
When asked about who the recipient of the card would be, over half of survey respondents purchased Whatcom Think Local First cards for friends or family members, 27% of respondents purchased cards for themselves, and 11% purchased for employees or co-workers.
Customers heavily favored a Whatcom Think Local First card (92%) over shopping at larger brands with a more generic card, citing a desire to shop local and support the businesses in their community.
Sustainable Connections, a nonprofit organization in Bellingham, WA, creates thriving communities through innovative ideas, collaboration, and action. Visit sustainableconnections.org
Bellingham Whatcom County Tourism is an independent, 501 (c)(6) nonprofit economic development organization whose purpose is to improve the economy by marketing Bellingham Whatcom County as a premier, year-round visitor, sports, outdoor recreation, arts and cultural, and meetings destination, which supports all travel, tourism, and hospitality businesses and nonprofits in Whatcom County.