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Table of Contents

Lead Story

Mission: ETA

News

Industry Update

Make a mark, take a stand

Mobile commerce popular, NFC lagging

Accepting payments, iPhone style

Antisocial online networking: ID theft

Aite busts merchant retention myths

Features

AgenTalkSM:
Miles Mulcare

Growth in payment risk can be mitigated

Eston Fain
AQ2 Technologies

Selling Prepaid

Prepaid in brief

Virtual gift cards given a twist

GPR cards and reload networks: A complex relationship

Continental Prison Systems Inc.
The 'get out of jail' card

Views

Regulation, deregulation, self-regulation

Patti Murphy
The Takoma Group

Education

Street SmartsSM:
Go ahead, work some magic

Jason Felts
Advanced Merchant Services Inc.

Work/life balance, an employers' issue

Curt Hensley
CSH Consulting

Think outside the converter box

Dale S. Laszig
DSL Direct LLC

How to win back e-mail jilters

Nancy Drexler
SignaPay Ltd.

Get what you want from your staff

Vicki M. Daughdrill
Small Business Resources LLC

Get what you want from your staff

Vicki M. Daughdrill
Small Business Resources LLC

Steer clear of buyout pitfalls

Adam Atlas
Attorney at Law

Company Profile

Velocity Merchant Services

Metro Merchant Services

New Products

The 21st century signature

SignatureSafe
Company: ElectraCash Inc.

Taking a cue from teens

Text-2-Transact
Smart Transaction Systems Inc.

Inspiration

Just say no to bootstrapping

Departments

Forum

Resource Guide

Datebook

A Bigger Thing

The Green Sheet Online Edition

March 23, 2009  •  Issue 09:03:02

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SP
Virtual gift cards given a twist

CashStar Inc., an online gift card program provider exclusively affiliated with Coupons Inc., recently launched its e-gifting, marketing and promotions platform. The platform allows e-commerce sites to provide interactive, virtual gift cards to its customers.

David Stone, Chief Executive Officer at CashStar, said its e-cards differ from competing products because consumers can customize virtual cards with images and messages of up to 160 characters and e-mail them to recipients. The virtual cards can be redeemed online or in-store. The e-mailed cards are given bar codes, so when recipients print them out and go to physical stores to redeem them, store clerks scan the bar codes like other purchases - a feature Stone said retailers "really like."

According to Stone, several top-tier, brand-identifiable retailers have already signed up for the program, including Gorham Bike & Ski of Portland, Maine., Pizzeria Uno Corp's Uno Chicago Grill and Altour Incentive Management's Travelocity Incentives.

Uno Chicago Grill reported its gift card sales more than doubled in the last two weeks of December 2008.

That supports Stone's contention that 85 percent of gift cards are redeemed three to six months after they are received. And when recipients use their gift cards online, they spend on average 60 percent more than the gift cards' face value.

Good timing

In research conducted by its subsidiary, NCH Marketing Services Inc., Valassis Communications Inc. reported that couponing is back in vogue due to the flagging economy. It found consumer packaged goods (CPG) coupon redemption in the fourth quarter of 2008 increased by 16.7 percent compared to the same quarter in 2007.

As consumers save money by taking advantage of ad inserts and hoarding their receipts for two-for-one deals at the grocery store, Valassis predicts online purchasing will increase in 2009. Online CPG coupon distribution was up more than 80 percent in 2008, according to the report. Additionally, redemption volume of online coupons increased nearly 130 percent to 4.8 percent of all CPG coupons redeemed in 2008.

Stone believes CashStar's affiliation with Coupons holds the year-old company in good stead. Coupons - said by Stone to be the largest coupon management company in the world - "incubated" CashStar. Coupons.com gets "15 million unique visitors a month," Stone said. "They're a top 50 Web site and it's growing 30 percent a month because of this economy."

Therefore, CashStar markets its service through Coupons.com. The combination of the couponing function with virtual gift cards, "creates a lot of opportunity for lift management, marketing," Stone said. "And because it's in a digital format, [retailers] can also use it for rewards or incentives."

A green solution

In conducting research, CashStar realized the majority of gift cards were purchased from brick-and-mortar stores. But CashStar also discovered a high percentage of those gift cards were purchased as last-minute gifts, and 34 percent of the time those gift cards were given to people who lived more than 50 miles away from the purchasers.

"It seemed to us that the online channel made a lot of sense for innovation in this market," Stone said.

Another factor at play is the amount of waste associated with plastic cards. According to Stone, 80 percent of them are thrown away after use - accounting for 100 million pounds of landfill nationwide.

So the virtual gift card solution saves on the petroleum used to produce cards and to power automobiles to get consumers to stores to purchase them, he added.


For more stories from SellingPrepaid E-Magazine, as well as breaking news and forums devoted to the prepaid sphere, please visit www.sellingprepaid.com.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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Spotlight Innovators:

North American Bancard | USAePay | Super G Capital LLC | Humboldt Merchant Services | Impact Paysystems | Electronic Merchant Systems