For our first year at Cork & Candles, gift cards were something we set up because, well, every business does. We had a small sign at the host stand. We sold a few hundred dollars of them every December. We thought of them as a holiday revenue bump and nothing more.
Then we ran the numbers properly.
In year two, after we got serious about gift cards as a real product line, they grew from about 2% of total revenue to roughly 12%. Same venue, same staff, same class schedule. The difference was treating gift cards as a year-round revenue strategy, designing the customer experience around them, and, critically. Picking a booking platform that handled them correctly.
This post is about the playbook. Some of it is operations. Some of it is software.
Why gift cards work so well for experiential venues
Three reasons most operators undercount.
The margin is closer to 100% than you'd think. When a customer buys a $100 gift card, you receive $100 in cash. The booked experience that eventually redeems against it has the same variable cost as any other class. Instructor, materials, room time. But you've now front-loaded the revenue against a future date and (importantly) against a future class that might not have happened otherwise. The gift card creates the booking; the booking would not have existed without it.
Breakage is real. Industry data says somewhere between 10% and 19% of gift card balance is never redeemed. For a small experiential venue, this is straight-line profit. We don't intentionally optimize for breakage (more on that below), but it's real and it compounds.
Gift cards are a customer-acquisition channel. Most gift-card recipients have never been to your venue. They get the card from a friend, they redeem it, they have a great Saturday night, they come back, they refer friends. The card buyer is the customer. The card recipient is your future customer. You've turned one customer into two for the cost of running one class.
The combination of high margin, breakage, and acquisition makes gift cards one of the highest-leverage revenue lines you can run.
What "doing it right" actually looks like
We learned the hard way that there's a big gap between "we sell gift cards" and "gift cards work as a revenue stream." Here's what we now run.
Online sales, anytime. Customers can buy a gift card from our website any time of day, any amount, with a personalized message. Most gift-card sales come through this channel, not the host stand. The card buyer is often not in our market. They're sending it to a friend in Philadelphia from California for a birthday. If gift cards aren't available online, you've capped the market to whoever walks through the door.
Multi-denomination, including class-specific. We sell $50, $75, $100, $150 cards, plus class-specific ones ("Two seats at a Friday class, $150 value"). The class-specific ones convert at a meaningfully higher rate because the recipient sees a specific experience, not a dollar amount they have to figure out how to spend.
Redemption at checkout AND in-person. This is the operational piece that platform choice determines. The card needs to redeem at online booking (so the recipient can book a future class) AND in-person at the venue (so they can buy a walk-in candle or pay a balance at the host stand). If your booking platform only handles online redemption, the recipient has to call you, and friction kills.
Split tender. A guest with a $75 gift card who wants to book a $90 class needs the system to apply the $75 to the balance and charge the remaining $15 to a card. Automatically. No staff manually splitting payments at the host stand. This is where a lot of platforms fall down. Bookeo doesn't handle it at all in their Square integration; FareHarbor and Peek treat gift cards as a separate-system bolt-on; even Tock's gift card handling assumes restaurant-shaped redemption.
Real expiration policy (in plain English). State laws vary, but in most US states, gift cards can't expire for at least 5 years. Don't try to expire them earlier. It makes you look slimy and probably violates your state's law. Do communicate the policy clearly at sale.
The pricing strategy
Three things we figured out by running the math.
Don't discount gift cards. A 10%-off Black Friday gift card sale undercuts your full-price experience. The recipient redeems the discounted card for a full-price class and you've eaten 10% margin for no good reason. The customer would have bought the card anyway. We have run this experiment.
Do bundle. "Buy a $100 gift card, get a $20 venue credit for yourself" works well. The buyer gets a small reward, you get a second customer (the buyer now has a reason to come in too), and the math on the bundle is much better than a discount.
Do promote at peak gift-buying moments. Holiday season, Mother's Day, Father's Day, Valentine's, Galentine's, end of year. Promote 2–3 weeks before each peak. The recipient might not have heard of you. Your gift-card promotion is also brand awareness.
What to do with the breakage
Not every gift card gets redeemed. Some are forgotten in a wallet. Some are gifted to people who don't end up using them. Accounting-wise, we hold the gift-card balance as a liability on our books until either (a) it's redeemed or (b) the state's escheatment period passes (varies by state, often 3–5 years from purchase).
Some operators harvest breakage aggressively. Write it off after a year, count it as found revenue. We don't recommend this for two reasons. Most states' consumer protection laws require gift cards to remain valid for years. And the brand cost of telling a recipient "your card expired" two years later, when they're finally trying to use it, is real. Better to honor it, run a great class, get a new customer.
What we do instead: when a customer comes in with a long-expired card, we honor it. Always. The cost of the class is minimal. The story they tell their friends is real.
The platform question
Most of this post has been about operations and customer experience. The software you pick determines whether all of this is easy or impossible. Three specific things to look for when you evaluate any booking platform on gift-card handling:
- Can the gift card redeem at online booking checkout? Some platforms handle gift cards only at the in-person POS. You're losing the online recipient.
- Can the gift card redeem in-person, at the same balance as the online card? Some platforms have separate "online gift cards" and "in-store gift certificates." This is a customer-service nightmare.
- Does the system handle split tender? A $75 card against a $90 class needs to apply $75 + charge $15 to a card automatically. If staff has to manually compute the split, mistakes happen.
ArtistryHost handles all three because we built gift-card support on top of Square's own gift cards. The same gift cards your retail POS already issues. One balance, one ledger, redeemable wherever the customer transacts with you, online or at the counter.
Bookeo, FareHarbor, Peek, and Tock all have gift cards at the platform level, but the balance lives inside their booking system, not unified with the in-person POS at your venue. The recipient can redeem online for a future booking, but for an in-person redemption (buying a retail candle, paying a balance at the host stand, settling a tab), the gift card is in a different system from your POS. Either the host enters it manually or the recipient is told the card "only works online." Both are operational friction the recipient feels.
This isn't a sales pitch. It's a checklist. If you're evaluating any booking platform, including us. Ask about all three. The right answer should be yes/yes/yes.
The principle
Gift cards aren't a holiday season add-on. They're a year-round revenue line, a customer-acquisition channel, and a high-margin product. Run them deliberately and they can be 10%+ of your revenue. Run them as an afterthought and they're rounding error.
The infrastructure to run them properly is software-dependent. Pick a platform that treats gift cards as a first-class feature, not as a bolt-on. The compound revenue lift over a year is real.