The synergies between prepaid and
video gaming are surprisingly obvious, and now prepaid issuers and
game makers are aiming to tap into this huge youth-driven market by
offering prepaid solutions tailored to this segment. As
Charles Davis reports, they
are also taking the opportunity to build customer
loyalty.
Go deeper with GlobalData
Of all the places for prepaid card
rewards to emerge, the video gaming sector might seem a surprising
one. The edgy, youth-driven gaming community seems an unlikely home
for prepaid experimentation, until one takes a step back and
acknowledges the realities: gaming is a multimillion-dollar
enterprise, with surprising demographics and unheard-of brand
loyalty.
So perhaps it is not that surprising that
prepaid card companies servicing the gamer crowd are developing
rewards programmes that allow co-branded partners to build
relationships with video game players.
The latest such product, announced in January
by gaming giant Electronic Arts (EA), is the prepaid EA Sports
DebitSmart Visa card, which features a rewards system that lets
users redeem points for some of its video games. Capcom
Entertainment was the first gaming company to launch a prepaid
rewards product, introducing its own Visa-branded prepaid rewards
card in North America last year.
Credit card-style rewards
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By GlobalDataFor EA Sports fans, the rewards are
quite simple: more EA Sports games. The reloadable prepaid debit
card enables users to receive a percent back from every purchase at
thousands of brick-and-mortar and online retailers to redeem points
that can be used to purchase EA Sports titles.
“The EA Sports DebitSmart Visa prepaid card is
a great opportunity for us to offer our community of loyal
customers a new way to purchase and save on their favourite EA
Sports game titles,” said Todd Sitrin, group vice-president of
global marketing at EA Sports. “Consumers use the card while making
their everyday purchases and are rewarded with video games. This
programme is a perfect marriage of encouraging responsible spending
while providing a unique reward programme.”
Funds for the cards can be allocated from a
payroll direct deposit, checking account, or another prepaid card.
Cardholders can also transfer funds electronically from a bank
account or arrange for the cards to be funded through direct
deposit.
The cards can also be loaded at thousands of
GreenDot and Western Union retail locations, including Wal-Mart,
CVS/Pharmacy, Walgreens, Rite Aid, 7-Eleven, and Radio Shack.
The number of points varies by retailer, but
it typically ranges from 1 to 10 for every dollar spent, according
to Randy Chase, a product manager at EA Sports. Cardholders can
redeem the points for video games, exchanging 6,500 points for
titles that work with Microsoft’s Xbox 360 or Sony’s PlayStation 3
consoles, or 5,500 points for a Nintendo Wii console game.
EA Sports worked with Coconut Creek,
Florida-based StorValue Card Solutions to develop the product,
which is issued for EA Sports by MetaBank. MetaBank charges
cardholders a monthly $1.99 service fee, $0.50 for each cashback
transaction at the point of sale and $1 for withdrawals at ATMs.
Online purchases and standard signature-debit transactions are
free.
Gaming – a multi-billion dollar
business
Gaming is big business, and a huge
opportunity for the prepaid card market. In 2009, EA posted net
revenue of $4.2 billion and had 31 titles that sold more than one
million copies.
It is a huge market, and one that does not
play to all the stereotypes about soda-guzzling teens staring at
PlayStation consoles all day, but there is a huge segment of the
gaming market that will find it increasingly difficult to obtain a
credit card.
A part of the Credit Card Accountability,
Responsibility and Disclosure (CARD) Act that takes effect this
month requires people younger than 21 either to have a co-signer
older than 21 or to prove they can handle the debt themselves.
A prepaid card, on the other hand, can be
issued to teens with no regulatory concerns, to say nothing of the
twenty-something crowd that forms the largest segment of the gaming
market. Adding credit card-like rewards to the mix will only add to
the attractiveness of the product.
Combining the passion of game players with the
passion of collectors is an even smarter combination. A wildly
popular new multiplayer online game, Dragonica, recently announced
a new line of collectible prepaid cards. The Dragonica Online
prepaid card series revolves around in-game elements, and will come
in values of $10 and $25. The first element series to launch are
the Water Series, the Fire Series, and the Earth Series. Each
include four different collectible cards depicting key characters
and scenarios from the game.
Fans who purchase a $25 card receive an
exclusive digital Dragonica Online comic book based on the element
of that particular card, plus a secret bonus item when they redeem
the cards for ICE Cash (ICE is the game’s virtual currency that can
be used to purchase items that customise a player’s Dragonica
Online character and gameplay experience).
Leveraging prepaid to loyal youth
consumers
Dragonica will release a new card
series each quarter, and special edition cards will reward players
with rare in-game armour and items.
“Prepaid cards are a great way to further
promote the game with our growing fan base, and an ideal way to
capture offline traffic,” said Wim Stocks, vice-president of sales
and strategic partnerships. “Our primary audience for Dragonica
Online is teen boys and girls who generally don’t have credit cards
at their immediate disposal, so prepaid cards purchased at retail
become the ideal means for them to get involved in the game.”
Targeting prepaid cards at highly loyal,
repeat affinity customers is a winning formula, one that the gamers
might have seen first in the casinos of Atlantic City and Las
Vegas.
Most casinos offer some form of gift card that
can be used at virtually every retail outlet at the property, with
the exception of the casino. By regulation, gift cards can’t be
used at the gaming tables and slot machines.
Harrah’s Entertainment, for example, pioneered
the development of the popular “player rewards” card offers. Its
Total Rewards gift card can be used at nearly 175 retail outlets in
Atlantic City and beyond, with rewards that can be used to purchase
tickets for shows at the House of Blues in Atlantic City, or for a
free meal at any of the more than 70 restaurants available at
Harrah’s four Atlantic City properties.
