Retailers online and off are finding that gift cards can boost both sales and profitability as some users spend more than card value. The number of FlexCache card transactions processed rose 230% in 2003 from 2002.
Gift cards` popularity is on the rise, and data on Paymentech`s FlexCache store-value card transactions offers more proof: the payments processor reports that the number of FlexCache card transactions processed rose 230% in 2003 from 2002.
Paymentech’s FlexCache program provides retailers with an end-to-end stored-value solution for issuing spending credit. Under the program, the issued gift card is activated at the time of purchase. The card value can be pre-determined with a set value that appears on the face, or the value to be attached to the card can be determined by the retailer at the time the card is issued. Value can be subtracted from or added to the card whenever the customer uses it to make a purchase.
One aspect driving the popularity of gift cards among retailers including online merchants is that they can help increase sales and profitability. Paymentech notes that 61% of consumers using FlexCache wind up spending more than the value of the card.