By Ben Kaplan, president and CEO, CashStar
Retailers are constantly being tasked with creating new ways to acquire new customers, drive sales, engage with shoppers and increase basket size.
While discounts and coupons have traditionally served as a tool to do this, this method can hurt profitability and deprecate brands. In turn, many retailers are looking for alternative strategies to keep consumers interested.
Enter prepaid commerce. In the form of stored value on a gift card, prepaid commerce is an effective way for retailers to engage shoppers without using costly traditional discounts. Think of prepaid commerce as a retailer’s own form of branded currency that can be used across the entire customer lifecycle to fuel sales, marketing and customer service.
There’s no debate about the value prepaid commerce provides in driving sales for retailers, especially in the form of gift cards. As the most requested holiday gift eight years running, according to the National Retail Federation, gift cards contribute significant value for retailers, as each transaction has two customers and often involves multiple shopping trips. In addition, industry data indicates that, on average, gift card holders overspend the card’s value by more than 45%, resulting in revenue beyond the initial gift card purchase.
