These types of cards have become a popular method of loyalty marketing and employee engagement solutions due to their success in engaging businesses and consumers alike. They allow customers to secure their funds, keeping them in one place, and they give businesses access to revenue before a purchase has even been made. Loyalty programs evolve as technology evolves, and prepaid cards are no exception. They began as plastic gift cards to specific merchants, and have since grown to be universally accepted worldwide. However, unlike gift cards, they can be reloaded and do not expire, making them more reliable and versatile. As e-commerce becomes the preferred shopping method for many customers, companies are offering more virtual solutions for online purchasing. With partners like Visa and Mastercard, they are accepted by most vendors, making them easy to integrate into customers’ shopping routines.
From the convenience of reloading value to the benefits of budgeting, prepaid cards are popular amongst a variety of customers. Both virtual and physical prepaid cards have numerous benefits with very few drawbacks, which makes them perfect for everything from corporate incentives and sales motivation to performance rewards and customer retention strategies. Virtual cards offer better security, for example, and do not increase production costs. Physical cards, on the other hand, offer ease of use and marketing benefits to both the consumer and the business. The question is, how do you decide which type of prepaid card will deliver the results you need for your next incentive program?
Physical Prepaid Card
With an appearance much like a credit or debit card, physical prepaid cards feature the customer’s name, a card number, and a magnetic strip on the back. One of their main benefits is versatility, as they can be used to make a purchase anywhere — in the store, online, or over the phone. This is important to keep in mind because the more places a customer can use their card, the more likely they are to use it. Offering this kind of card for your incentive program also gives the user a spending limit or budget. This would benefit shoppers who like to be more mindful about their purchases. Physical prepaid cards are great for those consumers who are not comfortable or familiar with the technology that virtual cards use. Since older customers are more likely to participate in rewards programs, it benefits businesses to take their preferences in mind. Additionally, physical cards offer marketing benefits, as they can be branded with a company’s logo for a more put-together, professional look. This will not only help customers differentiate your card from others, but it will also improve their perception of your brand.
Benefits of Physical Cards:
- Ability to use online and POS (point-of-sale) in store
- Can be used all over the globe
- Can be branded for your business
- Makes budgeting easier
Virtual Prepaid Card
A virtual prepaid card is very similar to a physical one. Except for only being able to access and use the card for online purchases, a virtual card offers all of the same options as a physical card. Unlike physical cards, however, they can be issued instantly, are more secure, and result in no production cost. As the technology for these cards advances, they offer more features and improved security for customers. As mobile payment services such as Apple Pay and Google Pay become more popular, so have virtual cards. Customers prefer the ease and convenience of not having to carry a card around and instead having all their payment methods on their phones. Moreover, virtual cards benefit the business by reducing production costs and improving marketing. Since the card is virtual, there is no expense of making and sending it out to customers. The money saved from this reduced expense can in turn be used to further improve the rewards program or offer other incentives to customers.
Note: It is essential when you are offering either product as an incentive in your program to establish what your participants’ shopping habits are like and whether they more frequently shop online or shop in a store.
Benefits of Virtual Prepaid Cards:
- Instant issuance
- Can be used immediately
- Ability to shop anywhere online
- No way for the card to be lost
- No production cost
Choosing the Right Prepaid Card
In a consumer-driven world, these payment options both fit the bill for ease, simplicity, and a highly desired reward. The team of experts at All Digital Rewards is eager to help you grow your incentive program, determine an effective prepaid card strategy, and enlighten you on the best program performance products along the way. We aim to drive higher engagement through our Prepaid Reward Management Payment Technology. To learn more about our prepaid incentive reward products and services, call us at 866-415-7703 or click “Schedule a Demo” at the bottom of the page!