Distinguishing Loyalty
by Render Dahiya, Arroweye Solutions

I think we can all agree that 2009 was a turbulent year. But I believe the story will read quite differently for the prepaid card industry, which is forecasted to come out ahead amidst the shakey economy. In fact, industry experts agree that the prepaid cards are in a high growth category. And according to Mercator Advisory Group, authors of an annual prepaid market assessment, this growth is attributed to “being in the right channel with the right product.” I couldn’t agree more, especially when it comes to loyalty and incentive.

Making a Connection
Loyalty is personal. It’s rooted in building affinity between companies and each of their employees or customers—and building affinity is dependent on consumers having a consistently positive experience with the brand at every touch-point. This is true in the aisles of an airliner, on the pages of a Web site or through the experience of receiving a plastic card as a reward. It’s clear that prepaid cards can be an important part of a company’s loyalty strategy—they can reinforce a brand and establish long-term relationships.

Loyalty, One Card At a Time
With the goal of increasing usage, marketers and loyalty providers are seeking new solutions, increased flexibility and more customization to reinforce their brand. They want differentiation, and a generic prepaid card mailed in a windowed envelope just doesn’t cut it anymore. Those who succeed in delivering a more personal experience will likely come out ahead. We’re seeing more companies looking to customize thew images and designs of cards, add their logos and distribute the programs in a unique and branded card carrier. Why? To break through the clutter and build a connection. Traditionally, production methods and ordering processes have made it cost-prohibitive to achieve this level of customization.

2010 is the year we recognize the possibilities and efficiencies of a digital on-demand prepaid card solution. A digital environment means cards are produced as needed, when needed, giving program managers the opportunity to quickly respond to their customers. Technology is available today to produce completely customized cards within 24 hours. The beauty of this solution for the loyalty market is threefold. First, it allows loyalty managers to tailor their card designs and carriers to be meaningful to the recipient. Second, it simplifies and expedites the process of getting a new program to market. Lastly, it lowers inventory costs by eliminating spoilage and limiting fulfillment expenses. The economic woes of 2009 remind us that the programs we invest in need to be effective, but also efficient and smart.

On the Horizon for 2010
All signs point to continued growth for the prepaid market in 2010. Increasingly, prepaid cards will become a mainstream offering. As more options are made available to loyalty providers, the more critical it will be to tailor card programs to stand out. Ultimately, on-demand production is a vehicle that makes this possible. Like every industry, there will be winners and losers. The companies that succeed in the loyalty and incentive space will be those that can quickly respond to demand and create a meaningful, relevant connection with their target.