Have you decided to outsource your gift card program? Now, you have to choose among the multiple solutions and different service providers. It is not an easy task. Should you rather go for a plugin gift card from your CMS (Magento…)? Or would it be better to work with a company that offers a compatible solution? So many questions, which need to be asked and carefully considered since the service provider will become an essential partner in the development of your business.
Several elements need to be considered when choosing a service provider, the decision must be based on the brand’s activity and goals. The implementation of a gift card program is quite complex and a wide range of skills and expertise are needed: customer interface, security, returns, payments… The service provider or solution will have to be able to provide these. Let’s review the different types of existing services.
Gift card plugins
For each CMS, several gift card extensions exist. Gift card plugins like Prestashop, Magento, Woocommerce all work the same way. They enable e-retailers to create a new product which corresponds to their gift card. The customer will then be able to order it like any other product, and the recipient will receive a code.
Extensions can easily be implemented
The main advantage with extensions is that they are easily implemented. In just a few clicks, you can gain access to new features with little or no development needed. It is ideal for people with limited skills looking for a quick and simple solution. Of course, you then have to choose a good plugin among all the different options available. Some key elements should be kept in mind when making your choice, such as: making sure the extension is compatible with the website’s CMS version, that there are regular updates, the number of downloads, the ratings, the comments, the after-sales service…
And the icing on the cake, the cost of the extension is not that high, it can even be very interesting compared to other solutions on the market. Some plugins are free and have additional features you can buy, as for others, prices range from €50 to €500.
Not a complete gift card solution
However, you must be aware of what is offered for such low prices. These price tags necessarily imply limited features. In the end, all plugins only give a small glimpse of what is possible compared to other complete and global gift card solutions available on the market.
Limited customer experience
First of all, customer experience varies greatly from one plugin to another and is not necessarily optimal. The customer journey can be long, redundant and incoherent, or the features can be too limited. It is important to keep in mind that, in a gift card program, it is the word “gift” that matters to customers. It needs to be easily and extensively customized, so they can have a unique present to give to their loved-one.
Moreover, consumers buying gift cards on an e-retailer’s website are not necessarily people who have already bought from the brand, and are probably not the brand’s target customer. Do they want to undergo the same journey as other clients? Must they really create an account for a brand they are not personally interested in? In short, does the journey enable them to buy and give spontaneously?
These are questions that need to be asked to make sure you have the best customer experience possible. In fact, the market of gift card solutions evolves constantly, continuously adapting itself to customer expectations, new technologies and new regulations. To remain competitive, a brand has to adapt to the changing market, which is not always possible with gift card extensions like PrestaShop, Magento or Woocommerce.
The second important point that must be underlined: there are risks. One could think that a simple plugin is less risky than a complete and more complex solution, but it is just the opposite.
Once implemented on the website, the extension has to be managed and updated. This can lead to unforeseen additional costs. As always, bugs and crashes can also increase the bill, and the author can stop upgrading the extension at any time. Because of their simplicity, extensions can be quite unreliable.
Moreover, since gift cards are a product, it implies having financial flows on the information system. If the implementation and management are not done correctly, the consequences can be severe. Any financial flow needs to be secure, and protected from online fraud. So, the risks are high, especially considering that gift cards are fraudsters’ favorite target.
Gift cards created with extensions are only redeemable on online stores and not in physical shops. Therefore, they cannot be used for web-to-store techniques. Customers will not be able to print them before giving them to the recipient. In short, they do not meet the current consumer demand: an omnichannel experience.
Limited back office
Most CMS extensions do not offer a complete back office on which you can control the entire program. With global solutions, you can track orders, study behaviors efficiently, conduct marketing activities (promotions, emailing for customer acquisition and loyalty). With a CMS plugin, gift cards cannot be used in a real marketing strategy.
IT consulting firms and marketing agencies
A new solution that plays a full part in a development strategy
Apart from extensions, we can find multiple service providers that offer much more global services. And in such cases, gift cards become a real product as well as a new means of payment, just like credit cards. It is a solution that is part of real long-term development strategies. There are many service providers on the market, especially marketing agencies and IT consulting firms who offer tailored solutions. With such providers, gift cards become a full-fledged IT project.
The service provider will develop a tailor-made customer interface, which can be customized with the brand’s colors. The journey is also optimized, and different journeys can be set for each type of customer. Gift cards can be offered to private individuals as well as professionals. But the latter have specific needs and demands, so they must have access to distinctive functionalities.
The brand’s employees will have access to a more complete back office in order to manage gift cards. They will be able to track orders, will have access to statistical reports on the program’s performances regarding behaviors and financial outcomes. They will also be able to carry out marketing and communication campaigns.
Greater costs and delays
However, because this solution is tailor-made, set-up costs are much higher than with plugins and will vary according to the complexity of the project. The costs can be significant, especially considering the additional expenses for the different updates and new functionalities the brand might request.
It also takes longer to set up than a plugin, it can vary from several months to a whole year. And the fact that the project is managed by an external company leads to a certain level of dependency. Hence the importance of choosing a trusted service provider beforehand.
Marketing and communication agencies: they have a solid experience in customer interface, customer experience and everything related to customer acquisition and loyalty thanks to gift cards. But when it comes to the heart of the project – making gift cards a new means of payment – they have limited expertise. Most of the time, they call on a subcontractor for everything linked to security and fraud in particular. Should you encounter any problems, chances are they will take quite some time before finding a solution.
IT consulting firms: most of the time, specialized firms are best suited to adapt to any context or problem. But it is still very important to look at their history, and know what their core business is. For example, a company whose main activity is plastic gift cards will most certainly have a simple solution for digital gift cards.
SAAS gift card solution
Easily implemented and efficient
A SaaS solution is a new management concept thanks to which it is no longer necessary to host the program on your own servers. The outside company takes care of everything: from the website’s maintenance to its hosting. It simply gives your brand access in order to use it. This management model enables brands to swiftly implement a solution, in just a few weeks.
An additional advantage of calling on this type of service provider is that experts in the field will guide you throughout the whole project. They will provide their technical skills and expertise, especially for the most tricky and important parts of the project: implementing the solution within the information system, support, … The financial flow service will be more secure than with extensions, thanks to an integrated fraud protection protocol that will be fully controlled by the SaaS partner.
The support will be based on the brand’s performances. There is a part dedicated to research and development, and monitoring the market trends in order to add new features and improve the performance level of the solution. A SaaS is much more flexible when it comes to adapting to the brand. If you work with one CMS or another, or if you have specific requirements, the solution can easily be adjusted.
Elements to bear in mind
However, a SaaS solution is not custom development, meaning that it cannot be completely customized to meet all the expectations of a brand. A unique customer interface and journey will be offered and will evolve according to the webanalytics and A/B testing feedbacks. Several different economic models exist, they can be more or less interesting depending on the budget you wish to invest in the project (subscription, performance-based, …). Once again, it all depends on the brand’s particular case. It is also important to carefully choose your SaaS provider based on specific criteria: current clients, the technology used, … in order to have a trusted partner by your side.
Key issues when choosing your gift card solution
- Customer interface and level of customization: is the customer interface flexible enough to meet the brand’s needs? Is the customer journey optimized or can it be tested? What functionalities are offered to customize gift cards?
- Functionalities for the brand: can you directly change the designs? Can you send gift cards as part of acquisition and loyalty strategies? Can you use gift cards in your promotions? …
- Omnichannel: are the gift cards redeemable in physical and online shops? Can they be sent by email in electronic format as well as plastic format?
- Compatibility and integration: can the solution be integrated to your information system? Can it currently be integrated to your system?
- Security: does it offer a fraud-protection system? What are the regulations in place? Does it use machine learning or a static model?
- Scalable solution and R&D: can the solution evolve over the coming years? How much is spent on R&D? Are upgrades included in the offer?
- Expertise: what is the service provider’s core business? What human resources are available? Which technologies do they use?
- Support and after-sales service: does the company provide service maintenance? How do they handle cancellations and refunds? Do they provide real guidance?
- Costs: how much does it cost? Is it a fixed price? Is it performance-based or not?
Summary table of gift card solutions
There are many choices available to outsource your gift card program, whether it is CMS plugins or different service providers. Truth be told, for an efficient service, a large part depends on your situation, requirements and budget. And it especially depends on the long-term vision the brand has for this service. For a more scalable solution, SaaS is highly recommended. But if you want a truly tailor-made solution, calling on an IT consulting firm or a marketing agency is the best choice. As for plugins, they are for brands who want the additional feature, but do not consider gift cards as a new development strategy.
Suggestions for further reading
Top 10 reasons why a brand should offer digital gift cards
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eGift card white paper