Why are gift cards better than cash?

You are here: Home \ Digital gift card \ Why are gift cards better than cash?

Why are gift cards more compelling than cash, from a corporate point-of-view?

The number one in popularity for corporate incentives, gift cards are more effective than cash. A study done by the Incentive Federation consistently indicated that merchandize and travel-related incentives were more attractive than cash – and in the merchandize category, gift cards were the most popular award items. Roughly 3 out of 4 respondents agreed that they could build a more exciting and memorable program using merchandize and gift cards than they would using cash.

Sales competition

How do companies utilize gift cards in their incentive programs?

  • Recognizing performance
  • A matter of sales incentives
  • Business gifts
  • Spot rewards
  • Consumer promotions
  • Wellness programs
  • To begin/ maintain a business relationship

More than 4 out of 5 respondents believe that merchandize and gift cards are remembered longer than cash rewards. Gift cards provide a certain level of flexibility and versatility of cash without the downsides.

There are 10 core reasons why gift cards are more superior to giving cash incentives – they are as follows:

  1. Trophy Value – A gift card purchase is more memorable, and creates a lasting reminder of their achievement
  2. Viral Value – The employees will tell each other how they spent their gift cards
  3. More Discrete – It’s more polite to mention non-cash awards. It is viewed as more socially acceptable to discuss
  4. True Gift Perception – Gift cards are not viewed as a part of a compensation plan. Cash is quickly viewed as compensation and disappears into the family budgeting.
  5. Universal benefits – Gift cards combine the benefits of merchandize with the benefits of cash. People prefer to have the choice on how to use their awards.
  6. Guilt-free Spending – Recipients do not feel guilty about treating themselves.
  7. More Likely to Improve Work Performance – Studies show that cash does not improve work performance.
  8. Family Support – Due to the family often being involved in the selection of the awards – they are more likely to support the participant’s goals.
  9. Pleasing the Loved Ones – There is a stronger motivation to earn an award for one’s significant other or their children.
  10. Long-term Positive Feelings Towards Organization – Gift cards can reinforce positive associations with sponsoring companies

So why not use gift cards a matter of rewarding your employees for a years good work, or reaching a goal they set for themselves? If you want to know more about our gift card API solutions, then contact us at hello@huuray.com and we’ll get back to you.

Teamwork

 

Sources:
http://c.ymcdn.com/sites/www.usegiftcards.org/resource/collection/8B96E304-E95F-4D16-A26D-A6D2F07AF81C/10ReasonsGiftCardsOverCash.pdf

http://www.ceridian.com/resources/newsletters/2010/Jul/using-gift-card-incentives-to-drive-employee-engagement.html

About author:

Leave a Reply