PittGlobal - Gift and Loyalty Cards

	Bankcard Services
Gift & Loyalty Cards

fictitious PGB bankcard A gift card looks and works like a credit card, but has a pre-paid value. Merchants have cards made and sell each for a given value. The customer pays that value and gives the card as a gift. The recipient tenders the card to make a purchase, applying the card's value against the cost of the purchase.

Despite sales and redemption at exactly the same price, gift cards are usually quite profitable to merchants. The recipient may wait days, weeks, months, or years before spending down the card's value. In the interim, the merchant obtains "free" money. And the recipient may be attracted to the venue and become a new regular customer. Moreover, as many as 25% of gift card value is never used, the merchant may enjoy a windfall profit.

For giftcard services, email PittGlobal.

Gift cards rely on bank card processing, so their use is a spin-off benefit to accepting payment cards.

Merchants may also give away gift cards to reward loyal employees or customers. (These are not to be confused with loyalty cards. See the next topic.) Loyalty developed among one's clientèle has obvious benefits in maintaining or increasing volume. Staff loyalty results in improved motivation and performance. Merchant's can use standard gift and loyalty card designs or order customized cards.

For reward cards, email PittGlobal.

for Bankcards

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bankcards@pittglobal.com

Loyalty Cards

A "loyalty card" is like a gift card, but has no purchase value. It simply identifies the customer as one entitled to special discounts or other benefits. Certain purchases may accrue "points" value to the card. Later customers may “spend” their points at the merchant’s business. In either case, the customer is encouraged to rely on the one single merchant. While the customer gets a benefit on a few items, the merchant can then record all purchases by that customer and determine how best to maximize profit from that source.

For loyalty cards, email PittGlobal.

Stored Value Cards

Gift and Loyalty cards are both classified more generally as Stored Value cards. The value is usually not stored on the card; rather the card reports its identifier number to a database computer that keeps track of the value. The value of outstanding cards is reported as a liability on the merchant's accounts because their value may be redeemed.

For stored value cards, email PittGlobal.

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