The Sky is NOT Falling on Plastic Gift Cards
With all the hub bub about prepaid technologies like mobile wallets, mCerts and virtual gift cards, Ben Jackson from Mercator Advisory Group, offers us his calming and factual perspective in
“The future form of closed-loop gift cards – Reports of plastic’s demise are greatly exaggerated”. Ben examines 3 great lessons of history to temper the overstated destiny of plastic gift cards and advises “that new technologies do not always completely distance old ones”. The history lessons offer great perspective that “There will always be a place for plastic, but (the) day will soon arrive where virtual cards and mobile cards will be a necessary part of every issuer’s prepaid strategy. The task for issuers is to figure out what needs each form factor fills and tailor their program to make each work towards the best results”, states Jackson. This is great advice for issuers, retailers and merchants as they look to grow their businesses with diversity versus alienating parties via the next big technology. Source:
Payments Journal, Mercator Perspectives
Google Wallet, gaining steam, revolutionizing payment
It's baack, we have blogged about it before, but now it walks among us, so it seems time to revisit Google Wallet. It is the first smart phone app, only available on a very select few smart phone models, that allows you to complete payment transactions using your phone, instead of a credit card, or the prehistoric form of payment, cash. Google wallet is revolutionizing commerce, and how people recieve rewards. Imagine how easy it would be for a company running a health and wellness program to simply place electronic CVS/Pharmacy gift cards in their employees' Google Wallet accounts, instead of going through the hassle of ordering physical cards, and having to have the cards activated. As revolutionizing as Google Wallet could be, it will still take time to catch on. For one, it is not yet widely available, and it would be a bit of a stretch to say that people will switch cell phones, or even carriers for this technology. Additionally, it remains to be seen how many consumers will actually use the technology, given that a wide margin have expressed discomfort in using mobile technology for financial purposes, give the possibilities of identity theft and hacking. Google Wallet will revolutionize commerce, and the face of the gift card industry, just not immediately.
For more information on Google Wallet, from someone who has actually tested the technology, click here
IMA 12th Annual Summit Roundup
There were many workshops, panels and info-sessions at this year’s IMA Summit. GCP’s Deb Merkin moderated the highly attended panel discussion: Challenges of Moving Bulk eCerts/mCerts Through the Distribution Pipeline. There was an overarching theme that carried throughout the discussion amongst panelists and attendees; there is a clear need for technology based gift card industry standards. Starting with what they are called, there are many terms used – “let’s standardize” was the consensus. IMA will survey leaders in our industry to cull common terms and help create standards. Another standard isn’t quite as simple to create: a common technology platform or industry technology standards for eCerts/mCerts. Some companies have a legacy system or a middleware provider with technology that isn’t compatible with the technology running a loyalty program’s platform (just one example). This issue affects retailers’ willingness to adopt eCerts/mCerts in the B2B marketplace, therefore meeting or not meeting the wishes of B2B customers and the consumers demanding technology based gift cards. The goal is common amongst all parties; we want to make it simpler for retailers to adopt technology based gift cards and for customers in the B2B market to purchase eCerts and mCerts in bulk. Plainly stated…standardization will be a win-win for our industry.
Who Buys E-Certs Anyways?
We know digital gift cards and incentives are popular, based on their ease of delivery and eco-friendly nature, while still providing the same flexibility of a tangible gift card. But what we want to know is who is most likely to buy this new technology? Research conducted by Urban Wallace Associates and sponsored by CashStar provided the GCP team with some insight. In this eGift Card Buyer Study, they interviewed over 6,000 eCert users across a national sample. Here are some key findings: There are 3 different demographic shoppers: 1. Generous Gifter- This is primarily a mom who is responsible for all the family gifting. She works,is part of a two-income household, has children and is very busy. She is looking for an easy way to shop with a personal touch. Giving a gift card or eCert is easy. She spends approximately $35per gift. 2. Metro-Digital Shopper- A young urban professional who is busy, looking for instant gratification, and only shops on-line, via smart-phone or ipad, often on the go. The Metro-Digital Shopper is highly educated, tends to spend over $75 per gift card/eCert and purchases during peak times like lunch time and in the evening. 3. The Grateful Boss- ( This is the segment GCP was most excited about, as we had a little potential for B2B information!) This is typically a front-line manager who wants to provide instant gratification for a job well done. He/She is highly educated, makes over $100K a year, and 98% are married. They tend to purchase gift cards/ecerts an average of 5-7 times a year with an average value of $150- $200! They usually purchase during lunch time between 11 AM and 12PM. The Grateful Boss may have a secret budget for this program, purchase it out of his personal funds, or through a formal motivation program. But in any of these cases it is important to provide quick gratification for the employee and reinforce successful behaviors. The research also discussed that 85% of digital gift cards and incentives are incremental sales over plastic! Which begs the obvious question, why aren’t more retailers using eCerts? Let us know what you think about this by leaving us a comment!
