Massage gift certificates: Does it make sense for your practice?
By Brad Cote, RMT
By Brad Cote, RMT
Selling massage therapy gift certificates is a popular topic amongst massage therapists. But let’s discuss the implications of selling gift certificates – whether or not it makes sense for your specific practice, and how to overcome some simple mistakes.
Selling gift certificates can be a great strategy to increase your immediate cash flow, as well as stimulate new patient bookings. These patients often are higher quality because they have pre-paid or received the gift certificate from a current patient of yours who already knows, likes and trusts your business. However, with the wrong strategy in place you can also experience numerous issues from selling gift certificates.
Before offering gift certificate sales in your practice you should consider the following policies & outlines.
1. Selling gift certificates because business is “slow” and you need cash
If you are selling gift certificates for the sole purpose of making quick money you create a few issues.
First, as healthcare practitioners we want to make sure that our services are tied to specific outcomes and positioning them as such. If we are just selling to make money this detracts from the services and results we provide to the patient and ultimately is a conflict of interest.
Second, you are delaying your financial position by taking money up front for the services that will need to be rendered later. Meaning if you take the payment as revenue now, you will not receive revenue in the future. This can create rollercoaster income and for someone who is not making a consistent income can be extremely stressful.
For example, during the pandemic, I have seen multiple massage therapists selling gift certificates in order to generate cash flow during slow periods or closures. The problem that this created was that the massage therapist had collected the money up front, only to have to deliver the services later on, thus creating a gap in pay.
The Fix: If you are selling a gift certificate ensure that you are specific with the outcomes and threading them into the patients needs. From an accounting perspective make sure you have a separate account for payments that you have collected but not yet rendered services for and only take out money from that account when services are rendered. This is known as “cash/accrual accounting.”
2. Not including redemption guidelines or expiration dates
Setting an expiry date is a good way to ensure that people take action towards their health and you don’t get a surprise two years later!
I have spoken to massage therapists who have several thousands of dollars of gift certificates that have been purchased but not yet redeemed and are well over a year outstanding. I don’t need to outline the obvious problem here (especially if you didn’t follow #1!).
Similarly to #1 you want to ensure there is a specific outcome associated to the patient purchasing the gift certificate so you can make sure that either the patient or whoever they are gifting the certificate to is going to take action and book.
You also may have specifications for redemption such as days of the week, kilometers traveled if you are mobile, extra costs for add ons and anything else that is specific to your treatments.
The Fix: Create your specific conditions for redemption and expiry details.
3. Create a system to track and follow up with gift certificates sold
Having a documented, updated list of all gift certificates sold, redeemed and outstanding is a critical component to a successful campaign. This system will allow you to follow up with those who have outstanding gift certificates and allow you to remind those who maybe close to expiration to take action.
Often I have hear stories of a patient who trys to redeem a two year old gift certificate and are extremely upset when they are told “it’s too late.” This creates unnecessary animosity between the patient and massage therapist when if the massage therapist has a reminder and performed follow ups the situation could be avoided.
Remember our goal is to have patients using our services to get results and improve their quality of life!
The Fix: Create a simple excel spreadsheet and record Date Sold, Name, Contact Details, Redemption Date, and Outstanding.
If you choose to sell gift certificates in your practice make sure to follow these 3 steps to ensure you get the most out of your campaigns and avoid the common mistakes!
BRAD COTE is the founder of Link Performance Therapy, a successful cash pay private practice with a focus on athletes. He has grown his clinic from zero to 7-figures revenue within 18 months of operation using a combination of proven structures, systems and strategies that he now shares with healthcare business owners across North America who are looking to gain new patients and grow their business.