Lifestyle demands continue to impact purchasing habits and it all boils down to the key appeal for consumers — time and place convenience. We have all seen the successful leveraging of one-stop convenience by big box and convenience stores. That’s led to consumers routinely relying on those very big box and convenience stores for their gift and GPR prepaid card needs. If you’re a bank or credit union, have you asked yourself how did this happen? Have you examined why your customers believe you can’t service their prepaid needs? Most importantly, what’s your plan to recapture your customer base and the profits that go with it?
The landscape is constantly shifting, but we all recognize the challenges in the evolving reality of looming market and economic changes. Whether you look at inflation, an economic climate of uncertainty, regulatory pressure, consumer austerity, the erosion of interchange or simply the changing habits driven by Generation Y, you might not see any easy answers. But, there is. It’s a game changer – ATM dispensed prepaid gift cards and prepaid cards.
Over the past decade, prepaids have evolved into a mainstream banking product. Consumers have moved from traditional gifting purchases or sending cash and checks to mark notable events. Prepaid card purchases continue to grow at an extraordinary rate and have become notable as GPR prepaid cards become a replacement for traditional checking account services. Many consumers now use them as a budgeting tool. Prepaids have become a mainstream banking product. This significant sea change in the consumer’s view of banking services has created a flurry of new opportunities and the numbers should tell you why. By the end of 2012, Mercator Advisory Group predicted that the total prepaid market size would reach $549.7 billion. GPR cards were expected to reach $118.5 billion in annual funds loaded by the close of 2012.
Here’s a sneak peak at some compelling data from just completed original research that we commissioned. This research looks at credit union members, but these numbers should be a wake up call to every financial institution. 50.5% of the group surveyed use ATMs, but buy their prepaid products elsewhere. In the survey group, only 5.6% bought prepaids from the credit union.
In reality, ATM-issued gift cards and other prepaid media capitalize on key qualities that consumers are increasingly demanding – time and place convenience, security, and value. Think about it. What would work best in your typical day? Would you prefer to make an extra stop or spend more valuable time to sift through a gift card display to find the card product you want, then stand in line and wait to purchase and activate or would you rather drive up or walk up to your trusted ATM and in a matter of seconds purchase your prepaid card, and be on your way?
We know what consumers think because we have first hand experience and can point to consumers’ enthusiastic response to our ATM-dispensed Visa prepaid gift card and our ATM-dispensed myGIFT multi-merchant Discover card. Dispensed through the ATM’s cassette tray, just like cash, our prepaids are part of a 3-panel sheet made of a thinner, rigorously tested, durable material similar to what has been used in transit systems for years. The snap-apart card sheet includes valuable premiums and incentives. The bonus of discounted products and services have particular consumer appeal and deliver a real sense of extended value – more bang for their buck. They card sheet also delivers promotional opportunities as you directly reach ATM-users with key messages about your other financial services and special offers.
ATMs are your gateway to new profitability when you offer prepaid products to your customers with the 24/7 convenience and security of the ATM. While your profits grow, you’re automating the costly, time-consuming task of over-the-counter sales, reducing your labor costs. You can attract new convenience-seeking, budget conscious customers and bring your existing customer base back for the products they’ve sought elsewhere, while you renew and strengthen brand loyalty with new opportunities for up-selling and co-branding with partners. It’s time to take another look at what is the largest, secure distribution network the world has seen, while you beat the big box and convenience stores at their own game with the ultimate in convenience.
Visit Better ATM Services’ Self Service and Convenience Strategy Session
