Time to spend the holiday gift cards

Now that everyone has received their holiday gift cards, what are they going to spend them on? According to a study, done by Archstone Consulting, and detailed here at Manage Smarter, recipients will spend them on necessities, including groceries and gasoline, and small indulgences such as eating out. Spending on gift cards was expected to fall 5%, or $25 billion, in the 2008 holiday season from last year's holiday season.

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Entertainment and Dining Prepaid cards most popular for work rewards

In a recent article at Manage Smarter, they look at how businesses are rewarding their employees by giving them gift cards, and most popular are dining gift cards. Entertainment gift cards came in fourth. They're a popular gift solution because it isn't something the employee would normally buy for themselves and they're able to include their family in the reward.

Some prepaid card companies have seen the demand for dinner and a movie or coffee and download cards increase.

Prepaid solutions companies like First Data can even arrange to combine the dining and entertainment on the same card. First Data's Landsverk has seen not only seen dinner-and-a-movie cards being embraced, but also coffee-and-a-download cards more recently.

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New prepaid card store online

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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SVM has new gift card program

SVM has announced a new gift card program. They've teamed up with Soldiers Angels for "Tank Support". This program distributes gasoline gift cards to soldiers who have served overseas. Citizens can purchase them online and then the gift cards are distributed to soldiers with the names of the citizen and a personalized letter. Read more about it here at Manage Smarter.

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Companies using gift cards to recognize employees

In a recent article at Manage Smarter, they look at how companies are using gift cards for expressing employee recognition, give them rewards or for company bonding programs. Instead of giving gift cards to employees to spend at home, increasingly employees are hiring personal shoppers and taking to the mall with their employees to bond and build relationships.

Creative Business Resources in Phoenix, Arizona took their employees to the mall and gave them $150 to spend in 90 minutes. After they returned, they shared what they bought, and the most creative purchases resulted in the winning more gift cards. We've reported recently on SpringBok Services offer new gift card options to employees with pre-determined spending spots and Omni being able to fully customize gift cards.

What do you think is the next big place companies will go with their prepaid gift cards?

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Michigan’s governor implements new laws for gift cards

According to this article at Manage Smarter, Michigan Governor Jennifer M. Granholm has implemented new laws on gift cards and gift certificates throughout the state of Michigan. The laws will take effect November 1, protecting card users this holiday season.

Some of the rules going into effect in Michigan are:

-- Prohibit retailers from refusing to accept a certificate during a sale, closeout or liquidation
-- Charging an inactivity fee or other service fee to the consumer for using or possessing a gift certificate
-- Selling a gift certificate that expires less than five years after being issued.

Things will be changing for retailers too:

--Retailers are not allowed to restrict the holder of a certificate from using it in a manner consistent with the stated terms of the certificate
--Alter any terms or conditions after issue
--Refuse to accept the gift certificate as a portion of the payment where the purchase is greater than the balance remaining on the certificate
--Consider cards abandoned property after five years.

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A gift card designed with businesses in mind

Corporate Promotions and Incentives (CPI) LLG is now offering a new gift card to businesses which is paid for only when the gift card is used. Manage Smarter reports that these customizable gift cards allow companies to enjoy the power of giving while they avoid a huge expenditure at time, only paying for the program launch when investing in the cards. Gift cards can be used at the online store by the employees which has over 2,700 products available for purchase. After they are used, the company is invoiced for the price of the gift card.

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edo Interactive introduces Facecard

edo Interactive introduced a new prepaid card, Facecard, at the beginning of July. ManageSmarter talked about the card here. Their goal was to combine their infrastructure of prepaid card design with a social network in order to target the millennial generation. Not only will this card have online capabilities, but also will provide the users with incentivized payment options at retailers around the world. edoCash will be a “prewards” function, where retailers deposit money on the card to be used at their store. The card was initially publicized at the Bonnaroo Festival this year to reach in order to reach their target audience.

Ed Braswell, the president and CEO of edo Interactive had this to say about the card:

"The Facecard Prepaid MasterCard simplifies the spending for our card members, and also creates a strong financial responsibility. It is a general purpose reload card that leverages online services and mobile messaging, as well as connects retailers to card members to offer incentivized purchasing opportunities."

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Simon Gift Cards Excel with Customers

Having sold over 34 million cards to date, the Simon Property Group Giftcard program succeeds at what it does. Since it is sold in 230 locations around the Untied States and can be used almost anywhere, the customers enjoy its convenience, affordability and versatility. It is recognized this week in Manage Smarter for that customer excellence. Simon Gift Cards also won the Best Retail Gift Card program this year at the 2008 Prepaid Card Expo.

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The Booming Gift Card Business

The gift card business is expected to reach $100 billion in sales this year; companies are trying to find new and exciting ways to expand their businesses with the options of gift cards. The new theme is multi-branding according to this article at Manage Smarter.

"People don't want to carry around five different gift cards they received as spot rewards in their wallets. They want one card that can be used in a variety of ways, even at a variety of merchants. For example, they could have a Starbucks/Apple card or a gas card attached to a McDonald's card. Right now, our company is piloting a couple of merchants to offer a card that can be redeemed at any of their stores."

The article gives credit to Starbucks for beginning the creative segment in gift cards. According to the article, the 2004 gift card with doubled as a Visa and an in store transaction card got the creative juices flowing. Another significant trend is that many gift cards are coming with loyalty plans, or points systems to earn rewards.

While some people believe that multi-branding gift cards save space in the wallet, as well as provide incentive to shop in many stores, there are still some skeptics. Timothy Rossi explains why:

“Many may think they are a 'cure-all' for recognition and incentive rewards. We have to be careful with the concept," he cautions. "If 'multipurpose' gift cards can be used to purchase everyday sundries such as milk, eggs or gas, then the intrinsic value of the recognition experience is lost."

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Gift Cards becoming preferred Gifts

An article at Manage Smarter has shed new light on the new view of gift cards as presents rather than a replacement for a gift. In the survey, 8,000 people stated they preferred branded gift cards from family and friends as presents. Cards displaying American Express, Discover, MasterCard or Visa logos brought high levels of emotional value to the receivers. Conclusions of this study show that now, gift cards are no longer seen as a utility gift.

Also according to the study:

-- 90% of the participants liked the ability to choose their perfect gift when receiving a gift card

-- 50% of participants preferred to receive gift cards over cash

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