New gift certificates use stored-value technology for cool credit
Gone are the days of oversized paper gift certificates that get stuffed
into wallets or, worse yet, forgotten at home. National retailers are rolling
out swipeable, storeable, reusable gift cards that look and act like credit
The gift cards showed up this past holiday season at stores such as Borders,
The Gap, Sears and Home Depot. Using "stored value" technology,
retailers assign value to the cards. The cards have magnetic stripes on
the back; sales associates simply swipe them when the gift is redeemed.
Customers can cash in only part of the certificate's value at a time (eliminating
time-consuming "rain checks"), and may add value to the cards.
The size and shape make them easy to store so they're always with customers.
Some stores use toll-free numbers through which customers access an automated
voice system to check the balance on their cards.
Many retailers modify existing point-of-sale systems to activate the
cards and accommodate transactions, says Kim O'Connor, product manager for
ValueLink in Sunrise, FL (954) 845-4514, www.valuelinkcards.com).
The company provides the plastics for its clients' cards, processes gift
card transactions and stores retailers' information in an on-line database.
Paper gift certificates are a headache, says O'Connor. "There have
been many problems with fraud, such as duplication and internal theft, because
there's no way to track paper certificates. They're also clumsy when it
comes time to sell them to customers. Now it's as easy as a credit card
transaction." Because the cards are blank until activated, retailers
can openly merchandise them on countertops, which increases gift certificate
sales, she says.
by Stacey King
Copyright © 1999 by Bond Communications.