On news that gift cards continue to gain popularity as presents, more and more companies are creating systems where their customers can use these gift cards. In the report which we covered yesterday, there was a section that mentioned that some Americans are using prepaid cards as a way to budget. A newspaper in Naples, Florida, Platinum Dry Cleaners announced that one local dry cleaning firm has begun gift card services for their dry cleaning stores. What do you think of the growing popularity of gift cards to practical places will do for the gift card industry?
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Last week, Chase announced the results of a survey that included 850 American adults, and it revealed that gift cards continue to stay popular. Nine out of the ten respondents had either bough tor received a gift card within the past 12 months.
Other interesting findings included:
- Typically, consumers spent more than the amount of the gift card when they are redeemed, with 85 percent adding an average of $17.70 out of their own wallets.
- Gift card buyers who purchased a gift card within the past 12 months bought 4.7 cards for others, in addition to two cards for themselves.
- 82 percent of users said that a discount for the purchaser's use when buying the gift card would make them somewhat or much more likely to purchase gift cards.
- Free specialized gift packaging for cards is a strong purchase motivator as well (61 percent)
Read more here.
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Starhome, a mobile phone roaming services provider, has launched its Prepaid Anywhere service in Africa to take advantage of the continent's high rate of prepaid subscribers, which stands at 90 percent to 95 percent.
The number of roaming agreements in Africa is low because the agreements are expensive and complex to implement, noted Starhome marketing officer Amy Daniel.
The key challenge for African operators wishing to provide roaming solutions to prepaid customers is their dependence on CAMEL (Customized Applications for Mobile Enhanced Logic) technology. Operators must enter into bilateral agreements with one another in order to offer CAMEL-based solutions, and these agreements require customers to pay a deposit --US$500 in Kenya, for example -- for roaming service.
Read the rest of this article here.
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From Foster Folly News
TALLAHASSEE, FL – Business Telecommunications Services, Inc., also known as ADMA Telecom, Inc. must now fully deliver the total amount of long distance telephone minutes as advertised and disclose all applicable fees and charges. The settlement also provides for a total of $75,000 to be donated to The Hispanic Institute, which assisted the Attorney General’s Office with its investigation into the prepaid calling card industry.“I am pleased the higher standards in place within the calling card industry will benefit many of our residents who were using these cards to communicate with family and loved ones,” said Attorney General McCollum.ADMA is the 12th company to reach a settlement with the Attorney General over issues related to the prepaid calling card industry. The agreement requires the company to cease any potentially deceptive advertisements, provide 100 percent of the minutes advertised, and submit to three years of auditing by the Attorney General’s Office to ensure that it is following the terms of the agreement. Further, as part of the settlement agreement, the company will provide funding of $25,000 per year for three years to The Hispanic Institute to support its investigative and monitoring efforts in this industry.
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From CreditCards.com:
People who have their payroll deposits, government benefit checks and other payments loaded onto prepaid cards may take comfort in a recent ruling by the Federal Deposit Insurance Corp.
Amounts stored on prepaid or stored value cards may be covered under FDIC insurance for up to $250,000 per account, the FDIC ruled in a legal opinion issued Nov. 13.
The ruling came after a coalition of consumer groups appealed to FDIC Chairman Sheila Bair in September to take steps to prevent consumers from losing money stored on prepaid cards or gift cards if an issuer (such as a retail store) or a bank holding the funds goes out of business.
The FDIC ruled on only one part of the request -- the issue dealing with banks that hold funds stored on prepaid cards.
For more information, please click here.
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Prepaid wireless is booming and expected to boom in 2009. According to this article at Fierce Wireless:
The data shows a growth rate of 14 percent for 2009 in the prepaid market, compared with 4 percent for postpaid. The carriers are also seeing some returns in the market; T-Mobile USA had 370,000 prepaid subscribers in the third quarter, up from 143,000 in the year-ago period. As credit has tightened up, prepaid may look like a more attractive option to customers that still allows them to keep their wireless phone, according to Boost.
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All Pay News recently informed us about Sticky Street, a new service that will allow smaller companies to begin to take advantage of prepaid cards. This new system allows smaller companies to set up an entire gift card balance checking online without the use of any hardware. For more information, read here.
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With spending expected to be down this holiday season, some companies are trying to spin prepaid gift cards into a new tool they can sell. The Christian Science Monitor reports on two specific stores specializing their cards with add-ons to reach their target market. Best Buy has a new gift card, where starting at $50, it has speakers built in and can function as a mini boom box. Target also has a new gift card that comes as a digital camera, along with 40 free prints.
Have you considered something like this for your company? What do you think consumers reactions will be?
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At the Ecommerce Journal, research shows that one in five transactions online this holiday season will use an alternative payment process such as PayPal, eBill Me, prepaid cards or other online services. The total amount of money that is expected to be spent this way is $7.8 billion, or 18% of the $42.8 billion projected this holiday season.
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According to Manage Smarter, a new online prepaid card store has opened. RewardCardStore.com is a place where companies can customize gift cards to fit their needs.
Tamara Carlton, product manager for AEIS had this to say about the new online store:
"RewardCardStore.com is ideal for small businesses and those individuals making transactional orders. They can log on, register for an account, set up a portfolio and place and order in five minutes. All of the cards are uniquely branded. We analyzed the needs of our customers and the demands of the market. Gas prices are high right now, so people look at the Gas Card as a great incentive. People also enjoy going out to eat, so we have The Restaurant Card. We launched products that will motivate the cardholders. So far the response has been positive, and there have been repeat visits."
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The New York Times Magazine took a look this weekend at how the RushCard provides an easy way for those who are unbanked to manage their funds. With an estimated 10 million Americans without a bank account, it provides a sense of belonging in America's culture where plastic has become a status symbol. Read more here.
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All Pay News reports that with Americans using prepaid Visa and MasterCard prepaid cards to replace traditional credit cards in this time of economic turmoil, PreCash of Houston, a prepaid cards distribution company, has increased grown 600%.
John Chaney, Chairman and CEO of PreCash, Inc. had this to say about the reason behind the growth, "Prepaid debit cards, like our Vision card, help cash-paying consumers access financial services they otherwise wouldn't be able to use. Many consumers use prepaid debit cards to manage finances while still being able to pay bills online; reserve rental cars or airline tickets; pay for gas at the pump and more."
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I recently came across the report "Economics of payment cards: A status report," written by Wilko Bolt and Sujit Chakravorti. The use of payment cards, which includes debit, credit and prepaid cars, has increased from 43% of payments to 56% of payments from 1999 to 2005. Europe has seen the same trend, as use of cards for payment has increased 140% from 1987 to 2004. Its a great look at how payments are being collected and how stores have adjusted to accommodate their users.
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In a recent article at ABC News, they examined how different state governments and programs are using gift cards encourage Americans to stay healthy. The article pointed out that the CDC offered gift cards to influential speakers in the gay and lesbian community to increase awareness on HIV and AIDS.
The Illinois State Department offered $50 gas cards to parents who signed their children up for health screenings. In Kansas, the Kansas Health Policy Authority gave $50 gift cards to state employees who filled out an online health assessment. Both the employees and state benefited, as then the Health Policy Authority could better determine what services they could offer to better serve their employees.
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This holiday season, you can choose to buy a gift card that's image was hand-drawn by a celebrity, some including, Christina Aguilera, Nicole Kidman, Jerry Rice, or Tim Allen. GiftCardLabs.com has issued a line of celebrity-designed holiday gift cards, and with each gift card purchase, they'll donate $1 to Marine Toys for Tots. Find out more here.
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Macerich recently announced its partnership with American Express to distribute the "Give Green" gift card, and AllPay News took a look. Looking to target the 82% of women who feel better about helping the environment, this American Express gift card will contribute money with every purchase, and donate up to $100,000 with this new program. Gift cards can be redeemed wherever American Express credit cards are taken.
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