According to a study by research firm TowerGroup, gift card sales in 2007 reached $97 billion, a $17 billion increase from 2006.  On both the consumer and B2B sides of the business, things just seem to keep moving forward.  As the corporate incentives industry continues to explode, gift cards continue to play a major role in that growth. 

Fueled by this persistent growth and the maturation of gift cards as a corporate incentive, we’re seeing more and more organizations looking to improve the efficacy of their corporate gift card programs by customizing solutions to meet the needs of their end-user customers. 

ÜBER-TREND: CUSTOMIZATION

If there is one true über-trend in B2B Gift Card Incentives, it has to be customization.  The last few years have seen the concept of customization move from simply printing a name on a card, to complete customization of the entire incentive experience from end-to-end.  This process often includes customizing not only the name but the messaging, the creative and visuals, logos and co-branding, the carrier, related collateral material and many other aspects of the overall experience.

That being said, there is one major drawback to the trend toward customization – more customization adds more complexity. 

A recent poll by Incentive and Potentials  magazines showed that the number one reason why businesses use gift cards as incentives is ease of use.  Given that, it has become imperative to move towards customization without increasing the complexity of managing the program.  Added complexity might explain why, in another recent survey by Incentive magazine, only 30%  of respondents actually make use of customized or co-branded cards.  

Luckily for all of us, there are a number of other trends that are now making full B2B gift card customization a reality. 

TREND#1: CUSTOM FULFILLMENT

In keeping with this trend toward full customization of the gift card experience, we are starting to see a major move toward what is known as one-to-one fulfillment.  While this trend has many facets, in it’s simplest terms it refers to the practice of shipping B2B Gift Cards directly to end-user customers.  B2B customers have been asking for this feature for some time – and with good reason.  One-to-one fulfillment allows for the continuation of the customized gift card experience right through to the time of receipt.

Again, referring back to ease-of-use as the number one reason companies use gift cards, one-to-one fulfillment is an obvious extension of the trend towards personalization.  Producing a customized gift card, loading it – these things are only half the battle.  The job is not complete until the gift card reaches its ultimate destination. 

TREND#2: CUSTOM ACTIVATION

Customized Activation (or Single Card Activation, as it’s known in the industry), is another emerging trend we’re expecting to see more of in the coming months.  Essentially, Single Card Activation is the ability to activate a single card, or any block of cards from a larger order. 

The main benefit of Single Card Activation is security.  A Gift Card that enters the mail system loaded and activated (ready to use) can be a major liability for the purchaser if it falls into the wrong hands.  By contrast, an unactivated gift card has no real value and therefore, presents no security risk when shipped, stored or otherwise. 

In simple terms, companies can take advantage of cost savings by bulk ordering cards while still maintaining control by activating in small batches, or even one card at a time.  What’s more, by combining Single Card Activation with One-to-one Fulfillment, cards can be activated by the end-user, once they have safely reached their destination.  The ultimate combination of customization, cost-savings and security. 

TREND#3: CUSTOM LOADING

Perhaps the most powerful of all the new developments we’re seeing in the B2B Gift Card space is the ability to Auto-Reload gift cards.  Imagine…ship a gift card to the end-user once, then reload it at any time, with any amount required.  This idea combines the ability to truly customize the reward or incentive (exactly the right dollar value at exactly the right moment), with the considerable cost savings of printing and shipping a single card with multiple users.

Consider a group of 1000 sales reps across the country who are rewarded for exceeding performance quotas on a monthly basis. The rewards vary based on the excess of sales ($100 for $10,000 in sales, $500 for $50,000 in sales) and each rep is measured on an individual basis. 

Using the typical “one card, one use” model, it’s easy to see we have a potential to produce and ship 12,000 cards per year to this group (1000 reps x 12 months x 1 reward/month). 

By using Auto-Reload, we could immediately reduce this number to 1,000 cards per year, each reloaded up to 12 times.  The cost savings on card production and shipping could be staggering.  What’s more, the re-loadable card provides each rep a constant, tangible reminder of the need to perform consistently.  Lastly, the cost of customizing the gift cards is more palatable if less cards are produced.  At $1.00 per card, the difference in savings  between issuing 1,000 vs. 12,000 units is significant!

THE BOTTOM LINE: ROI

There’s no doubt that the trend toward customization in the B2B Gift Card space has been fueled largely by a search for greater ROI. 

Obviously, the investment in customization is paying off for many organizations, since usage continues to grow by leaps and bounds.  But improvements in top line performance are only half the ROI equation – the other half lies in the bottom line costs.  The movement toward One-to-one Fulfillment, Single Card Activation, and Auto-Reloading is putting true end-to-end customization within reach of most organizations. 

We are all witnessing a glimpse into the future of Corporate Gift Card Incentives – and that future is customization.

1. "2008 Incentive Gift Card Roundtable", March 06, 2008; Manage Smarter. Obtained at www.managesmarter.com
2. Incentives for Your Employees or Clients, Newsletter-December 2007. Obtained at www.giftcards.com