Pieces of paper or a small thin plastic? I’d prefer the latter option. Starbucks’ gift cards – Christmas themed, Valentine’s Day themed, spring, summer, fall, and winter themed, all, of course, with the legendary icon “Siren” in the top right corner, are the most wanted gifts for the average trendy consumer as well as the retailer. The invention of the gift card was a groundbreaking idea for people who are just extremely unskilled in choosing gifts.

In 2001, Starbucks marked a new era in history of the gift card revolution by selling gift cards that could be loaded more than once; this was a big shift from the traditional, one-time gift cards that would be tossed into the garbage can after their use. Ten years later, in 2011, Starbucks started providing its mobile app service for its gift cards, a stored value system that let customers pay, load money, and have access to prepaid funds in their gift cards through a 1-second “beeping” on a smartphone.

Today, one out of seven purchases in Starbucks is made with a gift card, and thus, the company absolutely loves gift cards for the benefits they bring to the company. When a gift card is never used after it is bought, the store still keeps the money. Unused gift cards add up to profits of billions of dollars for business; from 2005 to 2011 in the United Sates, an absurdly high $41 billion worth of gift cards were gone unredeemed! Furthermore, the advertising effect of gift cards allows for additional sales. Being a gold member of the Starbucks gift card rewards system myself, Starbucks’ gift card app compels me go back to the store so that I can earn an additional “star” for a free drink.

The gift card, building customer loyalty, increasing brand awareness, and improving sales, is an unique innovation of the 21st century that will continue to change its form as time passes. From plastic cards to barcodes on screens – I’m positive that the next transformation of gift cards will be a breathtaking one.

Sources:

http://marketingland.com/coffee-mobile-king-starbucks-serves-mobile-strategy-98823

http://www.canadaone.com/ezine/oct07/gift_loyalty_card_programs.html

http://www.canadianpizzamag.com/content/view/1390/38/

http://www.bluepay.com/blog/4-advantages-gift-cards

https://www.firstdata.com/downloads/thought-leadership/fd_giftcardmarketingguide_toolstips.pdf