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One4all Rewards: UK Consumer Attitudes towards Gift Card Industry Regulation

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One4all Rewards: UK Consumer Attitudes towards Gift Card Industry Regulation

  1. 1. UK Consumer Attitudes Towards Gift Card Industry Regulation
  2. 2. Executive Summary • The UK gift cards and vouchers sector is worth over £4.5billion • 52% of that market is made up of B2B sales. • A significant 94% of that market is unregulated, which means employers that use gift cards as rewards and incentives are at risk of being stuck with large values of gift cards that might be worthless if the chosen retailer was to fall into administration. • Most notably the latest Personnel Today Employee Incentive survey has revealed a 1/3 of all HR managers believe that their Incentive budget is at risk
  3. 3. The Survey • In light of recent retail collapses, One4all Rewards in partnership with YouGov conducted research in March 2013 to gain insight in to UK Consumer attitudes towards gift card regulation. • The survey – undertaken for multi-retailer gift card provider One4all – shows that when asked to consider the recent collapse of high street retailers and the concerns about gift cards losing value, two- fifths (40%) of people would not feel confident spending money on the cards at the moment. • This follows consumers facing problems using gift cards after stores such as Jessops and HMV went into administration.
  4. 4. Safeguarding Consumer Funds  The YouGov poll, commissioned by The Gift Voucher Shop and surveying 2031 people, found that.. of people would feel more confident purchasing a gift card if they knew the money was safeguarded in the event of retail collapse. 78%
  5. 5. Consumers call for gift card protection
  6. 6. Loss of Confidence • The collapse of high street retailers has raised legitimate questions about whether their store gift cards would be honoured, resulting in a loss of confidence in the sector. of respondents also said that they did not know that regulated gift card options were available. 91%
  7. 7. Who is Regulated? • Legislation already exists to protect the funds held on gift cards, but compliance is not mandatory. • As a consequence, few retailers have opted to bring their single- retailer gift cards within the scheme to give greater security and reassurance to their customers. • In the UK market, only multi-retailer gift cards such as One4all give consumers this protection.
  8. 8. Reassurance of Regulated Products • This is a strong message to the industry that the public believe greater consumer protection is needed in order to restore confidence in the gift card market. • Regulated products bring clear benefits to consumers, giving them the reassurance that they won’t be left out of pocket in the event of a retailer collapsing.
  9. 9. No Knowledge of Regulation • Although legislation to protect funds held on gift cards in the UK currently exists, compliance is not mandatory for all gift card types. Britons do not know that regulated gift cards are available think all gift cards should be protected in the face of a retailer entering administration. 91% 86%
  10. 10. Government Lead Solution • Half (50%) of people think that any strengthening of regulations should be led by both the government and the retail industry. • This is compared to less than a quarter (24%) who think it should be led by the retail industry alone and only 12% who think it should be led by the government alone.
  11. 11. Overview of the Solution • Multi-retailer gift cards like the One4all gift card, are a fantastic way to reward and incentivise staff as they offer such a great choice to employees. • They also offer security to any HR manager that their investment is protected, but only if they choose a regulated product. If they don’t, they risk losing millions of pounds of their budgets and potentially damaging relationships with their employees.
  12. 12. The Benefits of Multi-retail • However, given the same scenario, over two-thirds (69%) of people say they would feel more confident purchasing gift cards that can be used across a variety of retailers, rather than one that can be used in a single store. • Confidence rises to over three-quarters (78%) if people know their money is safe should a chain go into receivership.

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