It’s In the Cards: An In-Depth Look at PrePaid Cards in Incentive, Rewards & Recognition Programs
- Prepaid cards are now the most frequently used reward in corporate incentive programs.
- Prepaid cards are being used as incentives across the spectrum, from spot rewards to holiday bonuses and for merchandise, dining, travel and entertainment.
- Closed cards are still the most commonly used type of prepaid card in incentive and reward programs, but they are losing ground to open cards. Restricted cards are a distant third.
- All prepaid cards, but especially open cards, are near cash substitutes. Open cards can be used virtually anywhere with the same ease as cash or personal debit cards. Cards of any kind can be redeemed online, or exchanged on secondary markets for other cards or cash. Despite this, card recipients demonstrate a strong preference for cards over cash.
- Prepaid cards are among the most popular gifts for recipients (whether as gifts from friends and family or as rewards from employers and other organizations). As above, prepaid cards are much more popular among recipients than cash. A full 44 percent of our card recipient survey respondents told us that prepaid cards are their favorite type of gift or reward. When offered a prepaid card or equivalent cash, five times as many of our respondents chose the prepaid card.
- The majority of incentive planners believe prepaid cards can be more meaningful, personal and impactful than cash; almost half believe that, dollar for dollar, they are the most effective reward available. More than 75 percent believe that they are among the most effective of all rewards ― especially in driving loyalty and engagement.
Customers Corporate Incentives – 10 Reasons Why Gift Cards are More Compelling than Cash
- There are 10 core reasons why gift cards are superior to cash incentives – they are as follows:
- Aligning your incentive or premium program with leading industry brands by offering their gift cards can significantly increase the participation in your program. Brand awareness is a major factor in end users’ shopping experience, and by offering gift cards for brands they already recognize and are currently shopping for, you add awareness to your program—which leads to greater participation. You also receive the benefit, not only of the brand of gift card you carry, but also of the brands of products and services the gift card provider offers: the benefits to your program of offering leading brands are very compelling.
- Number one in popularity for corporate incentives, gift cards are more effective than cash. Executive respondents to an Incentive Federation study consistently indicated that merchandise and travel incentives were more compelling than cash – and in the merchandise category, gift cards were the most popular award items. Approximately three out of four respondents agreed that they could build a more exciting and memorable program using merchandise and gift cards than they could with cash.
- Trophy value: Gift card purchases are more memorable – they create a lasting reminder of achievement.
- Viral value: Employees tell each other how they redeemed gift cards.
- More discrete: It’s polite to mention non-cash awards.
- True gift perception: Gift cards are not viewed as part of compensation.
- Universal benefits: Gift cards combine the benefits of merchandise with the benefits of cash.
- Guilt-free spending: Recipients don’t feel guilty treating themselves.
- More likely to improve work performance: Studies show that cash doesn’t improve work performance – gift cards do.
- Family support: Because the participant’s family is involved in selecting awards – they’re more likely to support the participant’s goals.
- Pleasing loved ones: There is a strong motivation to earn an award for one’s significant other or children.
- Long-term positive feelings toward organization: Gift cards reinforce positive associations with sponsoring organizations