CHANDLER, Ariz. -- Prepaid gift card purchases are on the rise, according to many recent surveys, and retailers like Bashas', Giant Eagle, Kroger, Food Lion and Walgreens are rolling out new program features in hopes of capturing increased gift card sales as the holidays near.
Bashas', Chandler, Ariz., recently launched a new gift card program just in time for Black Friday. The program allows the retailer to have more than 30 outside partners such as Home Depot, Starbucks, Sears, Old Navy, Best Buy, Bed, Bath and Beyond and others, according to Christie Frazier-Coleman, senior vice president of marketing and public relations for Bashas'.
The partnership cards will be merchandised at the front end of the store near the checkstands on a four-sided display. Promotions include ads in the retailer's weekly circular. These cards will be offered year-round in addition to Bashas' own supermarket gift cards.
"It offers our customers another convenience to make their lives a little easier," Frazier-Coleman said. "It's a great way to tie into some quality retailers and offer our consumers something more."
Giant Eagle, Pittsburgh, last month added gift card purchases to its fuelperks! gasoline discount program, and expanded the number of in-store displays to include prominent endcaps and other impulse locations. Changes in the retailer's point-of-sale system enabled it to include the gift cards and dry cleaning with the fuel program, and it promoted this heavily in-store and with advertising. "We expanded our fuelperks! earnings opportunities to provide customers with additional ways to earn fuelperks! savings," spokesman Daniel Donovan told SN.
Kroger Co., Cincinnati, also last month began offering new prepaid MasterCard gift cards. About 2,000 Kroger-owned stores around the country, except Fred Meyer, Ralphs and Food 4 Less, are selling these cards, called "A Gift For You," in denominations of $25, $50 and $100.
The gift cards can be used anywhere MasterCard debit cards are accepted, including online, the company reported. A small purchase fee is applied at checkout. "The addition of prepaid MasterCard gift cards means shopping at your local Kroger-owned store is more convenient than ever during the holiday season," said Kathy Kelly, president of Kroger Personal Finance.
Gift card sales will total $18.48 billion this holiday season, a 6.6% increase over 2004, according to a recent National Retail Federation survey. More than two-thirds of consumers polled said they plan to purchase at least one gift card, and more than half said they would like to receive gift cards this holiday season. Findings also revealed that gift cards rank as third on consumer wish lists this year.
In addition, the 20th Anniversary Holiday Mood Survey of retail spending and trends by Deloitte & Touche USA found that gift cards were the No. 1 choice for holiday gifts in 2005.
Food Lion, Salisbury, N.C., is also rolling out a new online program involving gift cards by the end of December. Currently, customers can purchase gift cards online, by calling a toll-free number and at Food Lion stores. By the end of December, customers will be able to reload their gift cards online as well.
"We're putting the finishing touches on the online re-load program. We think this will be a great convenience for our customers," Jeff Lowrance, spokesman for Food Lion, told SN.
Once this online program is set up, Food Lion will also have partnerships with other retailers. These details are still being finalized and everything should be up and running in a few weeks, Lowrance said.
Walgreen Co., Deerfield, Ill., offers partnership cards in addition to prepaid phone cards and its own gift cards, and has recently expanded its offerings.