November 5, 2009, 12:00 AM

Home Depot builds a new interactive gift card strategy

By letting shoppers personalize gift cards online, including with their own uploaded photos, Home Depot expects to increase the rate of card redemption and drive more incremental sales, director of gift card programs Michael Homiak says.

By letting shoppers personalize gift cards online, including with their own uploaded photos, Home Depot expects to increase the rate of card redemption and drive more incremental sales both online and in stores, says Michael Homiak, director of gift card and incentive programs.

“When people use our gift cards, they tend to spend more,” he says.

Home Depot recently launched a new online gift card program with CashStar, which provides hosted web technology that lets gift card buyers choose from several card images or design their own card with uploaded images and text. Timed for the holiday season, the new gift card program is designed to give consumers a more personalized card experience that the retailer hopes will increase card purchases and redemptions, Homiak says.

Although retailers generally stand to gain financially when consumers don’t redeem gift cards they receive, Home Depot figures redeemed cards are more valuable because they help develop customer relationships and lead to incremental sales as card recipients typically spend more than the value of their gift card.

The new CashStar gift cards, once a buyer chooses an image and value for it, can be e-mailed to recipients either immediately or at a selected future time. The cards are not available as traditional plastic cards. Instead, recipients who receive an e-mailed gift card click a link in the e-mail to log onto a CashStar-hosted, Home Depot-branded web page where she can print out the card on paper. The card can be used for purchases in a Home Depot store, or the recipient can key in its code number to make a purchase on HomeDepot.com.

The CashStar gift cards are also designed so that recipients can spend part of the card’s value, with the remainder stored online for future use.

“We know there’s a strong consumer need for this type of card,” Homiak says. Home Depot has received positive feedback so far through online surveys of card buyers, he adds.

Home Depot is No. 43 in the Internet Retailer Top 500 Guide

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