Today, Businesses resort to using prepaid gift cards to help grow their sales and raise awareness. According to recent research, the prepaid gift cards market was valued at $2.2 trillion in 2020 and is expected to reach $3.9 trillion by 2026. In the United States, branded payment solutions have increased by over 50% in the past five years.
With global e-commerce and online shopping transforming the retail industry, the digital world further propels prepaid gift cards’ popularity. It does not matter what scope or size your business is, but a prepaid gift card will make it stand out.
What is a Prepaid Gift Card?
A prepaid gift card is a payment card preloaded with funds in advance. You can use the card to purchase or withdraw up to the available balance. A prepaid visa card for business expenses can serve different purposes, like travel, payroll, or subscription management cards.
Here are five ways how prepaid gift cards make your business stand out.
1. Creation of New Opportunities for Consumers and Brands
Most consumers like the flexibility of prepaid gift cards in tracking their spending and accessing services even when they opt out of the subscription. For example, millions of consumers across the US still use no bank account. For them, prepaid gift cards make lots of sense.
Others prefer a simple way to limit their spending and opt for gift cards to help manage their daily life. With gift cards, one has no credit check to pass, and they can only withdraw or spend on the amount the card has. Prepaid gift cards also help businesses to grow and engage their customer base.
2. Increases the Levels of Data Privacy
With prepaid gift cards, consumers do not have to be worried about their details. The high level of security is because gift cards are not credit cards and have no linkage to bank accounts.
The consumer’s financial information remains secure even if a card gets stolen or lost. The consumers can only spend the amount in the gift card, reducing the chances of fraudulent activity.
With the increase in data manipulation and hacking cases, consumers are getting more concerned about the privacy of their data and getting aware of the risks that come with sharing personal information.
Most consumers always want more control over who can access their details. According to recent research, up to 90% of customers prefer complete or more control over their data usage.
3. Helps in Encouraging Customer Loyalty
Prepaid gift cards are a reliable and sure way of rewarding your customers and encouraging them to be loyal to your brand. Several e-commerce retailers offer prepaid gift card programs during holiday sprees like the Christmas Holiday and the New Year Celebrations to help increase loyalty with their current customers.
Businesses can master e-commerce gamification by introducing offers like offering a free $10 gift card to customers who buy $100 in a particular product category. Customers who spend $150 on a product category can get a $20 gift card.
Such offers help convince customers to spend more, increasing your business’s average sale in return. Consider making the prepaid gift cards a bait to help attract more customers after the holiday season to enhance your sales during the off-season.
Since your business can access valuable data analytics, you can use the information to understand customer behavior and make informed business decisions. Various brands can also use this information to personalize their engagement and marketing efforts and improve customer satisfaction while establishing loyalty.
4. Reduces Debt Accumulation
Prepaid gift cards help reduce debt accumulation by limiting spending to within the amount loaded onto the card. Compared to credit cards, prepaid cards do not allow users to spend more than what is on the cards.
That ensures people stick to their budget and prevent overspending. Prepaid gift cards do not involve borrowing money, and one will never accumulate debt or will not have to pay any interest.
5. Offers a Greater Degree of Convenience and Flexibility
One of the most outstanding benefits of prepaid gift cards is that they offer their customers greater convenience and flexibility. Customers can reload their cards in-store or online and comfortably use them at different locations.
Apart from the customers benefiting from it, retailers also benefit from its cost-saving element. Businesses can save money by using these gift cards. They eliminate the need for credit card processing fees and remove chargeback risks when preloaded.
It enables firms to save on costs, especially those that process high volumes of transactions.
Conclusion
Prepaid gift cards offer a secure and flexible alternative to traditional payment methods. It allows customers to manage their privacy while engaging their favorite services and brands without revealing personal information.
With the rise of data privacy concerns and the cost of living crisis, the use of prepaid gift cards will rise, making it a necessary consideration for businesses that want to grow their brand loyalty and retain customers.