Gift Cards Awaken a Sleepy Customer Base, Spurring People to Spend and Engage More With a Business

In a Nutshell: With so much competition for a consumer’s dollar, businesses can struggle to grow revenue. But gift cards can help a business stand out in a crowd. BHN Rewards offers a range of gift card programs to amplify a customer’s spend and loyalty. The company helps businesses track their rewards offerings and measure their success.

Consumers have more shopping options in the 2020s than they’ve had at perhaps any other time in history. Those who can’t find an item they’re looking for in stores near where they live can head to the internet to peruse what online retailers have to offer. But when you’re shopping for a gift for someone who isn’t easy to buy for, having more options may make zeroing in on the right present even more difficult.

We’ve all been there, scanning website after website looking for a gift someone will actually use. I sometimes buckle under the pressure of finding the right gift and consider giving cash, but for some people, cash gifts signal a lack of imagination on the gift-giver’s part.

Enter gift cards — the answer to many a holiday conundrum. Gift cards are a more personal present than cash. And they allow shoppers to give a gift they know the recipient will appreciate because they’ll be the ones choosing how to use the funds on their card. 

The Blackhawk Network (BHN) started as a division of Safeway Inc., selling gift cards in retail shops throughout the U.S. If you’ve ever walked into a store such as Home Depot or Target and noticed a display of gift cards available for sale, BHN may have been the company behind the sale of those cards. But BHN sought to expand beyond the retail space into other channels that allowed it to serve more customers.

Over the years, BHN has grown organically and by acquiring other companies. It bought Rybbon to boost its gift card program, rebranding it as BHN Rewards. We spoke with Marina Hodges, BHN’s Senior Director of Product Marketing, to learn more about how gift cards can help businesses engage with their customers and grow their loyalty.

“We’re in a unique position where we go out and find folks who want to have cards distributed, and then we sell and distribute those cards,” Hodges told us. “The acquisition of Rybbon, and subsequent creation of BHN Rewards, was part of our strategic play to meet the needs of companies who want to be able to offer rewards or incentives within other applications. We help create those solutions so that end users have an experience that’s seamless.”

A person may be in the market for a new hat for all sorts of reasons. Maybe they just want something to provide some shade on a hot summer day, or perhaps a certain kind of cap will put the finishing touch on a new ensemble. People value choices when they’re shopping, and businesses demand flexibility in rewards programs so they can incentivize their customers in a manner that aligns with their brand.

BHN Rewards consults with businesses to determine what they’re trying to accomplish with a rewards program and how BHN Rewards can craft solutions to their needs. The company counts among its customers market research firms that reward people for completing surveys. Hodges told us BHN Rewards must provide rewards to a research firm’s participants quickly, so they feel that their contributions were valued.

“There’s a whole gamut of ways that businesses need to be prepared to reward their customers,” Hodges told us. “People who participate in a firm’s research project don’t want to give up all this data and then sit around waiting for two weeks for somebody to mail them a gift card. That’s how long it can take if the firm had to have somebody run to the grocery store, pull a hundred cards off a shelf, and stuff them in envelopes — that’s the old way of doing it.”

Companies trying to distribute gift cards the “old way” in the 2020s are likely to run into a few problems. Hodges told us that retailers are very cautious with their shelf space these days, and many of them aren’t interested in carrying a large inventory of cards. Retailers may also suspect an individual of participating in a fraudulent activity if they’re attempting to purchase a large quantity of gift cards during one shopping trip.

Some customers of BHN Rewards require a simple solution. For clients demanding a more complex rewards program, BHN Rewards provides an onboarding service to make sure they know how to deploy its rewards solution to their customers.

“We can set up customers very quickly when they just need a couple hundred gift cards to accomplish what they’re looking to do,” Hodges told us. “Customers who have an ongoing program with elements like rebates may want to get an API connection set up, and there’s a lot more that goes into a project like that. It can take customers who want a more involved, larger program with a lot of facets up to six months to totally onboard.”

Businesses that expand their footprint can access new markets and revenue streams. BHN Rewards doesn’t manage all the gift card programs in the world, but don’t be surprised if you’re in Germany or Japan one day and see its name on a rewards solution offered there. The company differentiates itself from its competitors by being flexible to offer programs that work in more than one country.

“Anybody can sell you a gift card to Starbucks or Amazon, and a lot of the actual card products and rewards they offer are very similar,” Hodges told us. “One of the things we do to separate ourselves from other companies in our space is we focus on a global approach. Companies are global, and they want to be able to buy cards that work in foreign countries and with different currencies.”

Of course, any conversation involving digital transactions naturally gravitates toward fraud at some point. BHN Rewards has built controls into its programs that help a business manage rewards cards but also its accounts in the event that the business is hacked. Hodges told us the controls BHN Rewards provides allow its customers to offer gift card programs without worrying that criminals will gain access to their accounts.

BHN Rewards provides users with a seamless experience across devices to help them feel safe when transacting online. Hodges told us that if an online process asks a user to complete too many steps, then they’ll feel that something isn’t right with the site and will stop using it. For an online retailer, that means their customer will abandon a potential sale before it’s finalized.

“Businesses used to focus on providing surprising and delightful experiences to customers, but the new standard calls for experiences to be more than just delightful,” Hodges told us. “It has to feel secure and it has to feel right to an end user, and sometimes it’s hard to figure out exactly what that means. But you don’t get any credit if the experience you offer doesn’t feel right all the way to the end of a process.”

Rewards are such a common part of shopping in the 21st century that it’s no surprise that BHN Rewards works with a variety of businesses to boost their rewards capabilities. 

Hodges told us that many smaller companies work with BHN Rewards because they don’t have the internal resources to build their own rewards program. BHN Rewards also works with large enterprises that may have the ability to create their own program but lack the expertise BHN Rewards offers to help them package their program and fortify it against fraud. 

BHN Rewards frequently works with businesses in the healthcare, education, and travel industries. Hodges told us that consumer-packaged goods companies are increasingly turning to gift cards to inspire people to buy their products, and they’re engaging with BHN Rewards as a result.

A successful rewards program can boost a company’s sales. But businesses pay to offer and fulfill rewards, so they may struggle to determine whether the cost of a program is worth an increase in loyalty or sales.

“We have a great research group that tries to give businesses ideas about different things they can do with rewards that, although they may cost more, they deliver more value,” Hodges explained to us. “For example, people will put a higher value on a $10 Visa gift card than a $10 Starbucks card because they can use it in more places. It’s all about what a business is trying to achieve and what product can help them do it.” 

BHN Rewards built a feature into its platform that allows a business to track its return on investment on rewards campaigns. It also offers functionality to help companies track the points its customers accrue through rewards programs. 

“We have some pretty slick tools that let you manage and see all the different programs you’ve run and how they’ve performed,” Hodges told us. “That allows you to make adjustments going forward to maximize what you’re getting out of your program.”