Why Call It Branded Currency?

As we get closer to The Flourish Conference (only 11 days away!) I have been thinking about a conversation I have been having recently. A few people have asked me, “Why call it branded currency? Why use a name that does not have the recognition each individual product has?”

Those are fair questions- why create confusion?

I mean a customer will not know the term branded currency. But I would argue the terminology serves one very major purpose: to change the way we view gift cards, prepaid products, loyalty points, coupons, promotional codes and merchandise credits.

1. Our Current Terminology Keeps Products and Data Siloed and Therefore Holds You and the Customer Back

When we keep products and services that have a natural tie to each other separate, we lose the ability to string together some incredible data! Think about how you could connect with a customer if you tied her gift card, to your loyalty program and noticed she had not been in, in awhile.

So you offer her a promo code and remind her to use that gift card you know she has! She comes into your store, buys something a little more expensive than she would have normally, because she has a promo code and all the free gift card money! She enters her loyalty number, swipes her gift card and you can not only see exactly what she bought, but also the time it took her to come back in after receiving the promo code (maybe even measure the form factor of the promo code?), and how much she spent beyond the value of the gift card. From there you are able assess the ROI of that promo code, AND you know which products she likes. That customer wants a frictionless experience in-store and online. She wants to feel like you made everything easy for her. But even beyond that: When we combine powerful products together and measure the sum of the consumer transactions- we take those transactions and begin to string together many interactions. Interaction has much more power than a cut and dry transaction. It inspires a more robust consideration.

It should be noted that while consumers aren’t expected to shift their language explicitly to “branded currency”, successful programs utilize creative ways to convey the idea. A couple retailers who have pioneered the shift in language include Kohl’s utilizing Kohl’s Cash and BoxLunch using BoxLunch Money. No one walking into those stores is saying “I have branded currency to spend” but because the programs are cohesive, it’s easy for BoxLunch customers to think in terms of “I have BoxLunch Money to spend”.

2. Semantics Matter

The data shows that traditional gifting of the gift card is just a part of what consumers and retailers are doing with this technology. I was on a panel at the UKGCVA recently and in preparing for that panel we compiled a list of ways that gift card technology in particular is being used differently- here is what we came up with in about 60 seconds and stopped because we knew we only have about 40 minutes on stage and would not get through even half of this list:

• Cross-border remittance

• Insurance Claims

• Campus cards

• On the spot financing

• Self-use/ budgeting

• Un/under banked

• Subscriptions

• Crypto Conversions

• Virtual gifting of physical items

• Mobile payment enablement

The opportunity is incredible- but we have to THINK about our products differently.

We have to move beyond the nomenclature and push ourselves to say, what if we thought about this as branded currency instead? What if I decided not to put the normal parameters around this product?

3. Retail is the home of payment innovation

Let’s not forget the reason Visa, Mastercard, AMEX and Discover all exist is because Sears was extending credit to farmers. Farmers back then did not have access to capital until they were paid for their harvest or livestock. Plus travel was limited, so these people really relied on their local store for access to any new products. Sears revolutionized people’s lives by extending credit and mailing catalogs; making products and lifestyles available to people who had no access to these luxuries before. (If you want to hear a great short history of Sears check out this podcast- a really good episode with an unfortunate title- go to the 10 minute mark and it dives in to the fascinating history).

I think the key here is Sears used a simple loan system to solve a big pain point for customers. But, as retailers have been trying solve pain points one by one, we have created silos inadvertently; not knowing that customers would adopt our products and services and use them in their own ways! But we have to adapt to this. It is tough, but it can be done.

4. ALSO- Our Industry is full of crazy terms and acronyms that no one else knows- so this is not a new practice

Like I said at the beginning, I don’t think consumers will ever call it branded currency; much in the same way that consumers do not ask for an open-loop or closed-loop card. But we behind the scenes, know what these terms mean. The terminology has power. It is powerful enough to cause us to change how we use, position and even measure the results of these products.

If you want to learn more about the power of branded currency and how it can help boost brand awareness, consumer engagement, and sales, come and learn the latest at this year's Flourish Conference happening April 1-3, in Chicago. Learn more and register.