Top Challenges Faced by Businesses in Managing Gift Cards and How to Overcome Them

If you offer gift cards, you must be familiar with the challenges they can bring. Whether you are a business owner or a consumer, gift cards have likely significantly impacted your experience.

With the growing gift card industry trends, some problems are becoming more apparent. From gift card scams, activation failures, and unclaimed vouchers to compliance regulations and inventory management, such problems become an obstacle to revenue opportunities.

Let us fast forward to this guide to learn what these common hurdles are and how to overcome gift card challenges to maximize turnover and streamline operations.

Experts are setting up practical solutions to manage discount cards for the convenience of both vendors and consumers. Let’s have a look.

Fraud & Gift Card Security Issues

With the smart techniques employed by fraudsters, data protection & security have become one of the top gift card management challenges. Scams damage not only the brand image but also result in financial losses.

Account hijacking, cloning and exploiting vulnerabilities are major ways used by gift card abusers. It can occur in both B2B and B2C spaces. To anticipate this challenge:

• It’s important to promptly monitor transactions if any dubious pattern like multiple usages of the same cards occurs for gift card fraud prevention.

• Card assignment mechanism prevents illegal usage by other entity.

• Organizations can implement advanced security and utilize PINs for double authentication.

• Gift card tracking systems allow the detection of suspicious duplicates by generating a hash for every card and getting an alert if used twice. The hash helps in alarming the unauthorized usages.

Apart from that, there is modern software to extract the data of individuals owning the gift code. Verifying the alternative information provided at the time of redemption, knowing if it’s a suspicious activity or not.

Note: Here are the top strategies gift card providers use to safeguard vouchers from any security breaches. Read more!

Gift Voucher Redemption Challenges

Despite the mass appeal of gift certifications, businesses face gift card redemption problems. Well, the reason is not just the consumers who forget they own one. Sometimes, the businesses are accountable to the same extent.

Surprising Fact!

Likewise, not having a compatible platform to redeem, inefficient or slow processing, and the lack of active assistance are some of the challenges that occur on the retailer side. Here’s how to overcome this to maximize the potential of your prepaid cards:

• Regularly upgrade point-of-sale systems to accept all formats of cards and migrate the existing systems to advanced ones as per new technology introduced.

• Perform audits to test gift card activation & redemption on all sales channels to eliminate payment failure or errors. You can experiment with different case scenarios to curate the solution for each issue.

• Create well-optimized customer support channels to provide quick help and train staff to effectively handle complex problems.

Compliance with Legal and Regulatory Requirements

To protect gift certificates from security issues and legal problems, they must adhere to federal and state regulations. Managing cards according to laws and regulations is surely not easy.

Some countries prohibit vouchers from having an expiration date of less than five years. Always stay updated about these rules to ensure compliance with regulations.

Understanding legal requirements prevents any gift card compliance issues and builds client trust.

Partner with the best gift card analytics program providers to timely upgrade your systems with changing regulations. Some of the best experts in the market utilize high-tech methodologies to swiftly regulate their services as per the terms & conditions of the state laws.

Tracking and Analyzing Usage Data

Tracking and reporting capabilities are often overlooked but they improve the gift card life cycle and help in making data-driven decisions. Every time consumers redeem tokens, how would retailers know?

• Gift card tracking tools and analytic solutions help businesses capture the users’ activity. It identifies remaining reward values, and timely redemption and avoids gift card scams.

• With smart tracking methods, you can know the services’ impact on consumers, understand how cards are utilized and help them in offering a customized event next time.

Improve financial and operational aspects as they understand users’ patterns from the real-time analytics that refine the cash flow as well as the ROI.

Gift Card Activation and Load Delays

Another challenge faced by businesses is the concern related to gift voucher activation. Failure to successfully activate or delayed loading of a gift card leads to frustration that disappoints users.

Whether it’s digital or physical, gift card redemption problems may arise. To overcome this, it’s crucial to invest in well-encrypted gift card management solutions.

It does not only streamline redemption but also helps manage gift card fraud risk, improve processing speed, and facilitate easy navigation to get insights about inventory and available balance.

Such advanced tools provide responsive customer support that instantly resolves issues to support your business’s operations.

Unclaimed Gift Card Balances and Liability

The next obstacle many businesses face that impacts their revenue recognition is the amount of unused gift cards. It’s something they should pay attention to as it brings revenue depletion and funds lost.

Do you know?

To solve this issue, we must first know the reasons. Many individuals don’t remember using cards until they are expired, others just forget it in their overcoat or inside the pocket of their car seat.

This leads to pending balances that bring liabilities. Some of the solutions to consider for overcoming this challenge in the gift token business are:

• Integrate e-cards rather than physical vouchers as they are more likely to be misplaced.

• By running promotions and offering bonuses on purchasing specific products resolve many retail gift card management issues in a shorter span.

• Personalised approach is powerful as it shows target customers that you understand and value their interests.

• Sending reminders about their unused balance and then linking it further with their favourite product ultimately results in redemption.

With gift card analytic software, get real-time customer behaviour insights, pending redemption rates, & expiration alerts, and predict possible liabilities. Implementing these strategies can better manage unclaimed balances.

Gaps in Customer Support & Lack of Active Engagement

A proactive client support system is what the buyers long for.

Your work certainly doesn’t end after loyalty card issuance. It’s just the start! In ever-changing gift card industry trends, an excellent customer experience is what stands you out.

Consumers could have multiple issues related to card available amount, credit scores, expiration dates, redeem options and much more. Poor interface and assistance result in the loss of end users while excellent support improve customer retention.

The solution to overcoming gift card operational challenges is by using systems that could provide assistance and resolve their queries promptly. By introducing an industry top-tier gift card reporting software, you can enhance customer satisfaction and drive repeat sales.

Problem Related to Gift Card Inventory Management

During the highest demand and usage of gift cards, retailers often face challenges in gift card inventory management. It might involve tracking balances, stocking blank cards, and setting up expiration dates.

Integrating a digital voucher system with point-of-sale systems can help gain insights into sales and redemption. With the automated app or system to monitor your gift card stock, you can explore a new world of opportunities.

The Conclusion

Looking ahead, addressing challenges related to gift card security issues, pending balances, slow redemption process, activation obstacles and inadequate customer support is a necessity to staying competitive and maximizing the potential of your gift card programs.

Every business owner seeks ways to optimize gift certification performance to maximum impact on the audience. Sophisticated tracking and reporting have become a non-negotiable to maintain cash flow and gift card inventory management. Accurate gift card analytics gain visibility into consumer behaviour that supports business strategies.

BluEnt has helped hundreds of businesses in overcoming these challenges with powerful gift card analytic solutions. We offer practical solutions through actionable insights, tracking redemption rates and consumer patterns.

Our gift card reporting & tracking address the critical difficulties and assist in eliminating issues related to fraud, client engagement and low redemption rates. Get in touch to have an incredible business boost.