The Power of On-Demand Distribution in Prepaid Commerce

By Dann Gardner, Senior Product Manager

Acquisition. Retention. Reactivation. Loyalty. As commerce professionals, we’re constantly trying to influence consumer behavior and are always looking for effective ways to do so. It’s no secret that prepaid commerce, whether gift cards or promotional cards, is one of those ways. These cards are perceived by consumers as being more valuable than coupons and point-of-sale discounts and have routinely demonstrated significantly higher redemption rates than those other methods as well. However, using prepaid commerce to power successful marketing initiatives comes with its own set of challenges.

Take, for example, the relatively straightforward initiative of sending an eGift card to a list of several thousand lapsed customers to incent them toward a return visit. In this scenario, there’s an initial cost of obtaining and activating all of those gift cards in advance, as well as the overhead management tasks due to undeliverable emails, deactivating lost and/or undeliverable cards and the corollary customer service implications.

In our daily interactions with merchant clients, the Client Success and Marketing teams at CashStar strive to understand their goals and identify pain points like those illustrated above. Through collaboration with our Product team, we have built and launched a new capability designed to facilitate a wide range of marketing initiatives while mitigating those pain points. We call it On-Demand Distribution.

Groupon's On-Demand Distribution for Gift Cards

Groupon’s On-Demand Distribution Site

The concept is pretty simple. Rather than distributing the actual eGift cards, merchants can email a hyperlink containing a CashStar-generated code + PIN combination. Customers simply click the link and are taken to a merchant-branded, CashStar-hosted site which validates the code + PIN then leverages our real-time processor integration to obtain the eGift card for the customer. In other words, the eGift card is only activated when your customer takes action, eliminating the upfront expense and management headaches of sending thousands of eGift cards into the wild.

We record the customer’s email address when the code + PIN is redeemed, so you’ll know exactly who responded and which card they received. Our reporting capabilities provide all the necessary information for redemption analysis, enabling more targeted marketing to those customers in the future.

On-Demand Distribution was initially launched in late 2014, but we’ve expanded upon it this year by adding support for plastic reward cards as well as a multilingual user experience. We’re continuing to add features and enhancements to improve the user experience and broaden its capabilities. Thus far, our clients have used On-Demand Distribution to power third-party promotions, sweepstakes prizes and CRM initiatives, and to provide incentives for things like account registration and mobile app downloads.

Think On-Demand Distribution could help make your marketing initiatives successful? Interested in getting a more detailed understanding of how it all works? Let us know!

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