by Donna M. Airoldi | April 04, 2012
For incentive programs, print catalogs led the way more than a decade ago. Now, as egifting has come to the fore, all the talk is about mobile and social. Smart retailers and catalog merchants are leveraging the synergy among mobile and social gifting and online catalogs. 

Coupled with virtual gift cards, electronic catalogs clearly are more cost effective than print ones. They make it easy for program managers to expand award choices yet simplify the selection process and help save on merchandising costs. Participants benefit, too, from more immediate award opportunities and greater choices in both reward types and delivery methods. 

“Social interaction and mobile recognition are must-haves. They bring an instantaneousness to programs in all respects,” says Derek Irvine, vice president of client strategy and consulting for recognition company Globoforce. 

Catalog Convergence
Since its inception, Globoforce has offered only an online catalog, with a wide selection of awards. The company added egifts two years ago and more recently launched a mobile recognition platform. “Since adding virtual gift cards, the program has really taken off,” says Irvine. “REI was our first retailer. It’s a great brand and has been very popular.” 

As for the mobile platform, “it’s fully functional for the entire recognition program and not just a clever app,” he says. A manager can be anywhere and use her smartphone or tablet to interact with participants, add comments, and congratulate employees. Recipients immediately receive their egift cards or points via email and can instantly redeem them online or in stores. Also, if they’re shopping at a retailer, they can use their egifts or access the recognition program through their mobile devices and see if they have enough points to immediately redeem for an ecard and use it to buy the merchandise they want.

“Virtual makes it easy, and it’s led to increased participation in programs,” says Irvine. “But the delivery mechanism doesn’t make a gift card more popular. It has to be a great brand to begin with.”

A year ago, USMotivation introduced an enhanced online catalog with mobile options. The company connected with retailers Best Buy, Sears, and O.com, as well as boutique merchants, to offer a wide range of virtual gift cards. “It’s all about choice,” says Tina Weede, president of USMotivation. “We’ll look at the catalog, and if there are any deficiencies in offerings, we can secure other online retailers.”

Stacey Hargrave, promotions manager at Interstate Battery Systems of America, started using gift cards two years ago. “Gift cards allow the person who is getting rewarded to get what he really wants,” she says. “We used to stress over figuring out good reward choices, whether it was an electronic gadget or toys for children. Now we have a variety of retailers [through USMotivation’s catalog]. And using an online catalog has saved us money because we know we’re getting the best pricing at that moment. We’re also seeing time savings on maintenance and running of the program.”

Egifts Are in Demand, But Variety Is Still Key
L.L.Bean recently introduced egifts for incentive clients “as a way to help our business customers streamline their buying and servicing processes,” says Sean Tabb, marketing manager of direct-to-business for the retailer. He expects the platform to be popular because lead time from order to delivery is shorter (up to one day for egifts and two to three for physical cards); clients don’t have to manage physical inventory; recipients can choose physical, electronic, or mobile delivery and redemption options; and they can more easily keep track of rewards using their inboxes. 

“Being able to deliver in real time is much more powerful than someone hitting a reward threshold and then having to wait two weeks to receive it,” says Tom Niedbalski, senior vice president of business development at egift company Transaction Wireless. “Virtual allows immediate rewarding.”

Retailer Cabela’s has been offering digital programs with serial numbers and codes for about 10 years, and it added egifts with co-branding capabilities and mobile services in late 2011. “Plastic is still number one, but we are seeing an increase in electronic cards,” says Colleen Dorwart, loyalty project manager of gift cards. “They’re so much more versatile. But we still have clients that prefer paper certificates. It’s all about choice.”

The abilities to customize and co-brand more easily, with logos, images, video, and audio, are additional selling points for digital gift cards. “If you want to reward the sales team for hitting goals, you’re able to record voice messages, personalize each message, and congratulate the team manager with a personal touch,” says Niedbalski.

Dorwart says whether they’re plastic, electronic, or mobile, “the great thing about gift cards is they’re ageless and a portable extension of our brand. They fit every demographic.”

Experts see a generational divide in gift card delivery methods. “Most of our programs still use physical cards, because we find people like to use their points for gifts for others, but we have seen in multi-generational employee recognition programs that older participants want physical cards while the younger or more tech-savvy ones are looking for virtual cards,” says Noelle Torella, gift card operations supervisor for Rymax, which started offering egifts in late 2011. 

Torella adds that, so far, department stores, as well as stores like Bath & Body Works and Barnes & Noble, have been popular among participants who choose egifts.  

Other Trends and Benefits
Managers are creatively mixing egift cards with merchandise. Torella packages products together, such as a Gaiam fitness product with a Nike egift in a wellness program, or Villeroy and Boch tableware with a Pottery Barn digital card. “That’s not as easy to do with a physical card,” she says.

Electronic gifting has sparked greater use of spot awards. “Virtual gift cards provide great opportunities for managers to give smaller spot awards,” says USMotivation’s Weede. “As the industry changes and recognition is becoming paramount in engagement strategies, we’re seeing those types of awards in enterprise recognition programs more than ever before.”

Another change is that managers now hand out points instead of physical gift cards—from Starbucks, for example—so that recipients redeem for gift cards of their choice,” says Scott Siewert, USMotivation’s vice president of sales. “If I’m handed 50 points, I can choose the Starbucks card if I want or a Chili’s card or a Home Depot card. It meets my needs.”