Gift Card Program

1
Gift Card Program
2
Introduction

• Andean Marketing Group envisions a very
  successful and profitable source of revenue for
  all new merchants who choose our Gift Card
  Program Program.
• Andean Marketing Group is aware of the needs
  required by both the merchants and the
  cardholders and will always deliver an efficient
  and reliable product to both.
• The sole purpose of this program is to allow
  those loyal and constant visiting customers the
  opportunity to remain in a positive relationship
  with the merchant while they save time, energy,
  and money.
• This Gift Card Program will also assist
  cardholders in monitoring and controlling their
  spending habits.

3
Program Overview

• Access to account balance, transaction detail and
  other account related administration features is
  based on account ownership.
• Gift Cards are owned by the cardholder, neither
  the merchant nor the distributor have access to
  account balance and transaction details.
• With Open Loop cards, the cardholder will
  purchase an initial card (which will expire in 60
  days) at the merchant store. They will receive a
  new card with their name embossed on the card
  within 7-10 business days.
• With Closed Loop cards, the cardholder will
  purchase the card at the merchant location and
  will keep that card. If a personalized card is
  requested, the customer must allow 7-10 business
  days and pay an additional fee for the customized
  card.
• The merchant can only order Gift Cards and obtain
  basic cardholder information.

4
Program Description

• Gift Cards can be open loop or closed loop
  cards.
• The Gift Cards are loaded with a prepaid amount
  by the customer or loaded with a refund from the
  merchant to the customer.
• They must be loaded with the requested amount of
  funds by the merchant who sells the card.
• Gift Cards provide a quick answer to buying a
  gift at the last minute or for the person who is
  difficult to shop for.

5
Open Loop cards

• Opened Loop In the Opened Loop, gift cards are
  issued with card association branding, like Visa
  or MasterCard, and can be used anywhere the
  association brand (i.e., Visa, MasterCard), is
  accepted.
• Both Opened loop and Closed loop gift cards
  utilize existing processing networks.
• Consumers can spend up to the value loaded on the
  card, and can reload the card at anytime or
  dispose of it when the funds are depleted.

6
Close Loop cards

• Closed Loop In the Closed loop" SVC are issued
  by a specific merchant or merchant group (i.e., a
  shopping mall) and can only be used at that
  specific merchant or merchant group
• These cards are used primarily to maintain the
  customers use of funds inside the desired
  location

7
Gift Card Facts and Statistics

• 55 of gift card recipients require more than one
  trip to the store. (Standard Registers 2001
  National Consumer Survey of Plastic Card Usage
  and Awareness)
• Retailers switching from paper gift certificates
  to magnetic stripe pre-paid cards a year over
  year sales jump of 15 to 46 on prepaid cards.
  (Standard Registers 2001 Survey of National
  Retail Card Issues)
• More than 80 of major retailers are gaining a
  competitive advantage with gift card programs
• 15 of card holders never redeem the full value
  of their cards.
• (Standard Registers 2001 National Consumer
  Survey of Plastic Card Usage and Awareness)

8
More Gift Card Facts and Statistics

• A study conducted by Barrier Associates reported
  that 40 of consumers listed gift cards/gift
  certificates as their preferred gift to receive,
  more than all other categories.
• 59 of gift card purchasers buy gift cards for
  relatives outside the respondents immediate
  family 44 purchase gift cards for friends.
  (SVS consumer survey, 2004)

9
Merchant Benefits

• Additional Revenue!!
• Allows customers funds to be remain only in the
  merchants location (Closed Loop only)
• Provides merchant with savings on paper gift
  certificates
• Better alternative for issuing refunds to
  customers
• By issuing a return of their funds onto a Gift
  Card it demands the customer to spend that money
  in their store (Closed Loop only).
• Maintains customer satisfaction

10
Cardholder Benefits

• Cardholders can monitor their spending at their
  favorite stores or at prohibited stores for
  children
• They can also set aside a predetermined amount of
  money for each card in every different store,
  which will act as a budgeting tool
• Save on trips to the ATM or bank for cash
• With Open Loop cards, customers can purchase
  online and not have to focus on physically going
  to the store