The role of gift cards in the modern day has evolved far beyond simple consumer transactions. They’ve become powerful tools for companies to incentivise employees, reward loyal customers, and drive sales through promotions.
As businesses are becoming more and more keen to leverage these benefits on a larger scale, managing relationships with numerous gift card providers can become a daunting task. Enter the world of aggregators – intermediaries that simplify these complex relationships by acting as a single point of contact between brands and businesses.
However, as the aggregator market expands and diversifies, brands are faced with new challenges. How do they choose the right aggregators to partner with? How can they ensure their brand stands out in a crowded portfolio? And most importantly, how can they measure the true performance and profitability of these partnerships?
In this blog, we will delve into the intricacies of aggregator relationships, exploring why it’s essential for brands to work with multiple aggregators and how they can navigate this evolving landscape to maximise their reach and profitability.
What is an aggregator?
When it comes to B2B gift cards, an aggregator is a company that serves as an intermediary between gift card brands and businesses that purchase these cards in bulk. Traditionally, brands managed their B2B sales directly with purchasing companies across various sectors like employee benefits, promotions, incentives, and insurance replacement. Each brand would have individual agreements with each buying company and manage their gift card inventory manually. This approach was incredibly time-consuming, as well as inefficient.
Aggregators simplified this process by allowing buyers to maintain a single relationship with them, while the aggregator manages relationships with multiple brands. This means that companies can easily access a variety of gift cards without the need to negotiate and manage separate agreements with each brand.
Evolution of aggregators and the rise of digital gift cards
With the advent of digital gift cards, the role of aggregators became even more significant. Digital gift cards eliminated the need for physical inventory management, as they could be generated in real-time. This innovation reduced logistical challenges and streamlined the distribution process.
Over time, the market for aggregators has expanded significantly. In the United States alone, there are around 20 different aggregators that brands can work with. While this means that brands no longer need direct relationships with all buyers, they do need relationships with multiple aggregators to reach the widest possible customer base and to mitigate risks such as technical problems.
Global reach and uniform employee benefits
Many buyers, especially large corporations, have a global presence. These companies often seek to offer consistent employee benefits across all countries where they operate. This necessitates a global offering from gift card brands. By partnering with multiple aggregators, brands can ensure they are included in international programmes, even if they operate solely within one country. For instance, a brand like Currys in the UK can be part of a global employee benefit programme, similarly to Best Buy in the US.
Complexities of aggregator relationships
Choosing the right portfolio of aggregators
One of the main complexities brands face is determining the best portfolio of aggregators for their business. The market has evolved significantly in recent years, and strategies that worked a few years ago may now be outdated. Brands need to stay current with market trends and continuously evaluate which aggregators will provide the best opportunities for their specific needs.
Standing out in a crowded portfolio
Aggregators often manage a portfolio of over 100 brands, and to ensure visibility and maximise sales, it’s crucial for brands to work closely with them. They need to stay top of mind and seize any potential opportunities that arise. This can involve active engagement, strategic marketing, and collaboration to highlight unique selling points.
Measuring performance and profitability
It’s important for brands to measure the performance of their aggregator partners and, if possible, the different buyers. While many brands focus on sales metrics, other key gift card dynamics also play a role. For example, understanding the typical uplift in sales when gift cards are redeemed, or the value of unspent gift card balances, can provide insights into the profitability of the channel. Additionally, evaluating the commissions paid to aggregators helps brands understand the overall financial impact of their partnerships.
Savvy’s role in simplifying aggregator relationships
Savvy is a leading technology company specialising in international stored value processing and analytics. We partner with many prominent B2C brands, helping them optimise their stored value exchange programmes and drive business performance.
Here’s why partnering with us can transform your approach to managing aggregator relationships:
API connections to major aggregators
Savvy offers API connections to all major aggregators, providing a seamless solution for brands entering the B2B space. This means that if you’re looking for a gift card processor to enable B2B sales, Savvy’s existing connections can get you up and running quickly and efficiently.
Advanced analytics for channel performance
Savvy also provides advanced analytics, giving brands greater insight into channel performance and the profitability of their B2B aggregator relationships. This data-driven approach allows brands to make informed decisions, optimise their strategies, and maximise their return on investment.
Working with Savvy
We’re committed to helping businesses succeed by driving commercial growth and delivering exceptional customer experiences. Through our people, technology, and third-party connections, we provide a competitive advantage that helps brands get ahead.
Our solutions are flexible, scalable, and easy to integrate, supporting both physical and digital gift card formats. Whether you’re looking to launch, change, or optimise your solution, our expert team is ready to support you with your gift card programme and ongoing management.
If you’d like to find out more, book a meeting with our team today.
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