The term “breakage” within the payments industry refers to the dollars left on a prepaid card post card expiration. Those dollars are either funneled to the Program Manager (who constructed the initiative), or back to the company offering the card to their particular constituency. Generally speaking, people outside the prepaid industry (consumer groups) have an erroneous opinion on how breakage works. Here are some thoughts….
First, a network branded card (Visa, MasterCard) offers the cardholder choice. The cardholder can spend the full value of the card wherever they want. The only constraint is that they have to spend the entire load before the card expires. Evidence suggests that the majority of cardholders are happy to trade the card’s ubiquity for the limited time restriction.
Industry statistics demonstrate that less than 8% of the funds on a network branded prepaid card actually break. As consumers become more prepaid savvy, I expect that percentage to decrease over time.
Generally speaking, only a single value prepaid card will actually break. Reloadable cards (usually utilized in employee or partner programs) do not factor breakage as a source of revenue. Once a reloadable card expires, the cardholder is usually reissued a new card, and their available balance is moved to that card.
It is costly to support a card on a processor. The technology and cardholder services infrastructure are significant investments for companies in the space. Card breakage helps underwrite those costs.
If a cardholder has funds on a card post expiration, and they want to access their monies, they are reissued a new card less a nominal processing fee.
Without breakage revenue, consumers may not see the plethora of acquisition/retention campaigns available to them.
Companies initiating prepaid campaigns are now infusing cross-selling/up-selling strategies that overtly suggest what products the cardholder should spend their monies on. This tactic looks for the incremental consumer spend as a way to judge a program’s ROI.
Anyone looking to learn about the prepaid card space should visit the NBPCA website. You will find a plethora of relevant and objective industry information available.
The relentless quest of a manageable, confident golfswing has me perplexed and frustrated right now (as well as pissed off). The one thing all passionate golfers have in common is the desire to constantly get better. Practice, unfortunately is not the key to unbridled success…..unless of course what you’re practicing contradicts the thing that forced you to practice in the first place. It seems that once you “fix” one part of your game, something else breaks. Last spring, without anything I consciously did, I became one with my game. Honestly I was hitting the ball 10% farther, while lowering my handicap to a six; it was heaven! My brush with golf greatness lasted until late June as my game turned ugly, resulting in my handicap soaring to a 9 (mathematically almost impossible to do in 4 months). A deep golf depression set in as I have yet to work it out.
Here is the current, maddening issue that I am desperately trying to repair.
After completing a semi-hideous backswing, my right elbow detaches from my body, and points towards left field (classic chicken-wing), never to make contact with my right rib again.
As I awkwardly return to the ball, my best fly fishing technique takes over and fractures every angle earned during the prior motion.
The end result is a forced hand flip at the ball that miraculously gets the Pro V1 airborne.
Distance and accuracy are obviously compromised, but it is the consistency that has me vexed.
I have searched for answers over the last 6 months. Here is what I have found:
Most of the lessons/tips provided are difficult to understand. When you do understand the guidance, generally the “move” opposes something from an article from a prior magazine.
Magazines shill for their advertisers – the equipment manufacturers. When they tell me that after a custom fitting, an 18 handicap can now hit his tee ball 30 yards further, I feel like vomiting.
I own every golf training aid produced over the last 15 years (if you do not believe me check my basement).
Some have merit…..most just become a short-term paycheck for a washed up tour player/swing guru.
I do not remember one training aid having a profound impact on my game….not one?
How does the same swing issue result in differing root causes from 10 different instructors? I demonstrate the same unappealing swing to all of these guys, and each one tells me something different is wrong.
Recently, I succumbed to a GolfTEC advertisement, and went in for a consultation ($99). The instructor was pleasant, candid and insightful –then the lesson ended and the sales pitch began. He told me that it would take “between 10 and 20 ½ hour lessons in order to fix my swing.” Of course those happened to be the premier instruction packages GolfTEC sells. After multiple calls, I purchased the 10 pack – I will let you know the results over the next two months.
Yes, I will spend thousands on a game in disrepair. That said, I now realize that anything new from TaylorMade, Callaway, Titleist, Ping etc. only pacifies me until ball contact. At that point I realize that my reverse Jim Furyk is still solidly intact.
My dreams about playing in a state amateur event are fading by the day. I can only hope my persistency pays off so I do not embarrass myself in the two member/guests I play in every year.
For a company looking to create cost-efficient, targeted marketing campaigns, the statistics derived from the use of a prepaid card is invaluable. In a consumer promotion, the company offering the reward can easily create the profile of their buyer through the card activation process. In order to make the card spendable, the cardholder reveals critical demographic data. Once they begin to utilize the card, the spend data accumulated, clearly outlines where and when the money was spent. The power occurs when combining the demographic data with the spend information. The solution created is a decision support system that can be immediately levered against future marketing efforts. The output suggests:
What customers are ready for cross-selling/up-selling offers.
What customers are vulnerable to a competitor and could attrite.
How to improve responses to promotions thereby improving ROI.
During the first week of April 2010, I was fortunate to spend 4 days fishing the North Platte River for big rainbow trout. For the most part, the weather for the 4 days was overcast, cold (20 to 40 degrees) and windy. The conditions made it imperative to own and utilize the right equipment. I had purchased a lot of new fishing products over the last year, but I was particularly interested to see how my new Smith Optics Mogul Sunglasses performed. These shades are equipped with polarchromic lenses (definition below).
Smith Optics Polarchromic lens technology combines the benefits of glare obliterating polarization with the advantage of photochromic light sensitivity. Available in either Carbonic or Techlite glass, Smith Optics Polarchromic lenses automatically self-adjust their tint in response to ambient UV light conditions creating a tint level which is perfect at all hours of the day. These lenses retain their photochromic properties indefinitely, certainly outliving the life of the frame itself. Spanning a range of approximately 10%-35% VLT (Visible Light Transmission) Polarchromic lenses need only 10-25 seconds to fully transform from light to dark depending on UV light intensity. The result is a lens tint which is perfect at every moment of the day from dawn to dusk particularly at hours when the benefits of polarized are vital but the lens tint has to be light enough to see.
While I understand the basics of the technology used with these sunglasses, I was not clear on what it would do for me on the river?
I must say that the Mogul’s performed beyond expectations.
• First: The thick arms of the frame prohibited any light from penetrating the glasses. I never had to cup my hands around my eyes in order to see my targets in the water.
• Second: The lenses are amazing. The gloomy weather (limited sun) provided us a constant struggle to locate fish. I saw a lot fish that others could not see.
• Third: My eyes were always relaxed. We fished from 7 am (20 degrees) to 7 pm (40 degrees), and the light conditions frequently changed. The lenses smoothly adjusted to the conditions of the day without distraction.
My only advice to Smith Optics; offer spring hinges in the future. My melon is large, and spring hinges would be more accommodating.
If you are going to invest in fishing sunglasses, I highly recommend the Smith Optics Mogul with polarchromic lenses.
Prepaid is still in its infancy as an industry. Companies currently situated in the space are aggressively jockeying for market share. Many times a subset of these firms make outrageous capability claims in order to solidify a transaction.
Organizations looking to prepaid to solve complex business issues must thoroughly evaluate all potential providers before making financial commitments. The solutions outlined by many prepaid companies often rely on third parties in order to execute their programs.
Below are many components of the prepaid supply chain that will ultimately impact the customer/cardholder experience as well as the overall investment in the solution.
Program Management: The ongoing consultation that occurs between prepaid professional, and corporations looking for a potential solution.
Integration:APIs used to exchange data between all organizations involved….what cardholder has earned what monies, when and how.
Creative Services: Utilized for the design of a custom prepaid card. They must adhere to the numerous constraints required by the associations.
Card Manufacturing: Raw plastic is converted to a fully functioning prepaid card. This card includes an encoded magnetic stripe, custom logos and embossed personalization.
Card Fulfillment: Shipping to the cardholder or to the corporation.
Transaction Processing: Approves or declines every transaction that is sent to via MasterCard/Visa (and the merchant). Eventually provides detailed card reporting.
Compliance/Regulatory: PCI/DSS compliant along with being a secured MasterCard/Visa facility.
Cardholder Services: Every cardholder must be able to access card information through an IVR, Web or live operator.
Customer Service: Customers must have an assigned service team that they can contact in order to service a complex program.
Each of these functions are a cost and service center to the company evaluating prepaid. It is critical that a buyer understands who is ultimately responsible for the program should things go awry. Furthermore, it would behoove a buyer to understand the benefits of working with a vertically integrated provider where all of the functions listed above are controlled by one vendor. Single sourcing all of the functions associated with prepaid, guarantees a program is delivered cost effectively, securely and in a timely fashion.