by Alex Palmer | February 27, 2018

The retail gift card sector has seen enormous change and innovation in the last few years. So it makes sense that the Retail Gift Card Association (RGCA) is also raising its game. The trade association, which serves the closed-loop gift card industry, last year launched RGCA Forum, bringing about 150 retail gift card professionals together to network and learn. It also introduced new research and rolled out regular educational offerings aimed at better serving the association's members. The organization aims to build on that success in months ahead, while speaking to the evolving challenges facing those serving the retail gift card sector. To learn more about these issues and plans, Incentive spoke with RGCA Board Chair Colleen Dorwart and RGCA Vice Chair Erin Wood about these changes and what to expect -- from the RGCA and the industry more broadly -- in the coming months.

What are the biggest trends that you're watching in retail gift cards -- in the way consumers are redeeming and using them? 

While shoppers' adoption of mobile wallets has been a bit slower than anticipated, contextual commerce is driving change. Consumers are using a multitude of shopping channels being created by digital developments, and as a result, we're seeing the need to ensure stored value can be used as payment in new ways. We expect digitization of gift cards to grow as mobile and web usage gain traction and consumers expect and demand to use their stored value cards across channels without friction.  

Like our robust commerce landscape today, gift cards solve consumer needs in many ways: as gifts for holidays, birthdays, or to say "thank you." Employers give them to employees as rewards for a job well done or for professional achievements; merchants leverage them as incentives to drive new and incremental sales; and retailers utilize them to reward existing customers and generate loyalty. While none of these use cases are necessarily new and for years, merchants and consumers alike have appreciated the value of gift cards, they are being looked at through a new lens as the times change. When you package stored value differently, figuratively or literally, it takes on a new form and provides a renewed level of interest for what's possible. Even using the words "stored value" or "branded currency" put a new wrap on existing products -- opening up the possibilities of the role it can play or the need it can fill.  

With that in mind, what you say are the biggest challenges facing this sector?   

Consumers' tastes and preferences are constantly changing, so driving continued excitement about gift cards and taking gift card programs to the next level is certainly on the list -- especially given consumers' growing needs for personalized experiences. The evolution of commerce and advancements in payments technology have created more opportunities to engage with customers, and elevating gift card experiences by making them more customized and personal is becoming a vital part of ensuring positive purchasing and redemption experiences. 

Security is also always at the forefront of our minds. Fraud and fraudsters continuously evolve, so the industry will need to continue to identify and utilize a variety of fraud mitigation tactics to stay ahead of scammers and create a unified front that protects consumers. 

What does RGCA have planned for the year ahead?

In the coming weeks, we will be announcing the details of our second annual RGCA Forum -- which we're confident will exceed last year's impressive inaugural success. We have exciting plans to build on last year's foundation via refreshed perspectives and new, sought-after research from our committees and task forces; these insights will be specific to closed-loop gift card programs and present exclusive industry intel. In addition to providing retailers insights that can be used to benchmark and grow their B2B programs, Forum will also provide non-retailer members with forecasted performance predictions that can help advise their business strategies related to retailer gift card programs.  

Additionally, we will continue to facilitate a collaborative atmosphere that enables growth, supports the health of the industry as a whole, and creates positive gift card experiences for consumers. 

To address the challenge of keeping up with evolving commerce and consumer expectations, this year we will be hosting ongoing, year-round continuing education opportunities for our members, ensuring they have the most up-to-date information about stored value, gift cards trends and happenings, as well as access to top industry resources. We've also created a couple of new task forces; one designed to proactively identify secondary market best practices and another dedicated to mentoring businesses that are new to the industry. Our hope is that these endeavors will further support overall consumer confidence in the industry, drive engagement and create loyal repeat customers. 

As barriers between commerce channels are being broken down, so too are geography barriers. More and more gift card programs are going international to support consumers' desire to use their cards around the world. More global markets are adapting to consumer interest in stored value for gifting, incentives, and rewards. In addition to changing consumer preferences, international companies are seeing the value that gift card programs bring to businesses in the U.S. and are contemplating how to launch programs for these same economic reasons in other regions of the world. The RGCA recognizes this trend and will evolve the support international expansion in 2018.  

What would you say are the association's priorities for 2018?   

Understanding consumer expectations in this changing commerce environment is at the top of our list. We want to ensure that all aspects of the gifting experience and/or stored value use continue to meet or exceed expectations throughout the gifting cycle -- from purchasing or receiving to redemption. We also want to create a more robust internal platform for sharing information with non-retail members that have a significant vested interest in the health and well-being of the closed-loop gift card industry. 
What are you most excited about for the coming year both for RGCA specifically and the industry more broadly?

There is a high amount of energy around urging the industry and its stakeholders to continue to look at gift cards through a new lens that allows stored value to play a vital role in enhancing, enabling, and encouraging commerce.  

We are excited to continue to grow our membership and build upon our robust member base that brings expertise in breadth of areas that are influencing gift/stored value program success.  When the gift card industry is healthy, the entire retail industry thrives. By garnering new support and collaborating with different stakeholders, we can continue to unite the gift card industry with the purpose of creating positive gift card and stored value experiences for consumers. 

We also can't wait for RGCA Forum; last year's show sold out several weeks in advance and we look forward to continuing the exhilarating spirit of collaboration this year.