Just one word: Plastic.
Shoppers love it, and marketers of all stripes have taken note. At the same time, employers looking to motivate their staffs have come to rely on it to either motivate workers toward goals or recognize such milestones as longevity with the company. Whether used as a consumer or a trade premium, plastic gift cards are defining the flexibility and autonomy recipients say they want in incentives programs.
According to a 2002 study by the National Retail Federation, gift cards ranked among the top 10 favorite gifts in a list of over a hundred choices, higher than books or CDs. And in a survey conducted last year by Bank of America, 75% of respondents said they would prefer a $95 gift card over a $100 store card, sacrificing some the face value in order to exercise a greater range of choice when redeeming the card.
Given this enthusiasm among end users, it is not surprising that most of the major credit card companies have developed gift card programs. For example, Visa’s gift card is touted as a novel way to reward top-performing and long-standing employees, while simplifying management’s administration of incentive programming. In a basic plan, the personalized gift cards can be purchased in any whole dollar amount from $25 to $600, or can be re-loaded at the employer’s discretion.
“Unlike a trophy on a shelf, a gift card serves as an ongoing reminder of the employer’s regard for the employee,” says Amy John, VP of Consumer PrePaid Card, Bank of America. “Every time the recipient takes the gift card out of their wallet, they remember how valued they are.” Visa programs include personalized cards with messages that highlight goals met or corporate anniversaries achieved.
American Express also stresses the ease with which managers can implement its reward programs. It has partnered with Maritz Incentives in a joint venture, American Express Incentive Services, LLC, that provides a variety of card-based incentive programs, ranging from one-time rewards to ongoing targeted systems, with fixed value or re-loadable card options. The cards can be used wherever American Express is accepted or “filtered” for redemption at partnering retailers, restaurants, hotels, resorts and other businesses.
Partnerships growing
One Amex program, running now through Dec. 30, targets the lackluster meetings and hospitality market. The card company has teamed up with a roster of participating hotels in a promotion that rewards corporate event and meeting planners for booking into Six Continents Hotels, Holiday Inn Hotels and Resorts, Crowne Plazas and InterContinental Hotels. When the employees pay for the events using their American Express accounts, and then fax paid invoices to an Amex fulfillment center, they can receive gift cards valued at $200 (for events costing $5,000 to $9,999) to $500 (if the event was valued at more than $10,000) for their personal use.
Such partnerships within card programs are growing in popularity, and not only with the bigger credit card companies. Several major retailers have modified their credit operations to include more tailored gift card options. For example, cable TV channel Showtime Networks re-teamed this month with Toys “R” Us to offer a $50 gift card to new Showtime subscribers. The cards will be available from Sept. 1 through Dec. 31. Last year, New York City-based Showtime attributed a 22% lift in total business to a similar promotion. This year, Showtime is expanding the program for the holiday season with a national incentive sweepstakes for hundreds of prizes, including Vespa Scooters and $5,000 Visa Gift Cards.
The integration of gift cards into overall promotion signals that they are just beginning to reach full potential.
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