Gift Card Programs: Can They Reduce Claim Cost and Duration For Retailers?

Gift cards are one of the most popular gifts. The majority of retailers offer them and they can help drive up sales in many stores, but have risk managers considered using gift cards as a risk management tool?

GB implemented a Customer Care unit for one of our major US retail clients in June, 2016, after discussing a more efficient way to handle low severity claims that could also mitigate claim cost and improve customer satisfaction.

This Customer Care unit consists of 2 dedicated resolution managers that handle “low level” claims.

How does it work? Customers are now contacted within 24 hours after we receive the claim, and a gift card is issued as a sign of good will to the customer.

If the claim can’t be resolved with a gift card, it is escalated to the claims team for a full investigation. All incoming claims are triaged by Branch Management to determine if they are appropriate for assignment to the Customer Care unit.

The gift card gives incentive to visit the store after a less-than-ideal experience, and the retailer’s brand reputation remains in good standing.

The unit has already had a huge impact for this retail client’s program – the number of calls the client receives is significantly lower from unhappy or dissatisfied customers, and the claim cost was also significantly reduced.

Customers love it, too. 75% of all claims were assigned to the customer care unit; of those claims, over 34% were closed with a gift card offer. These results stick, too. Less than 1% of all claims settled were reopened.

Programs like this are low cost, but high impact for all they do, from both a cost and brand reputation perspective. Implementation can be very simple – consider what you’d be saving by making this simple offer.

Read more on GB’s American Website.