The 2020 Christmas office party is going to look a little different this year. From virtual drinks to Zoom karaoke, many firms are grappling with the reality of rewarding staff after a difficult year whilst adhering to whatever restrictions may be in place in December. But some towns and cities are taking a different approach as they seek to bolster their local economies by encouraging companies to consider gift cards as part of their incentive and reward strategies. And this approach isn’t just for Christmas.

Over on the east coast of Ireland, Drogheda Business Improvement District is getting ready to launch their Love Drogheda Gift Card in early November. As a prepaid Mastercard, the Love Drogheda Gift Card can be spent with a variety of local businesses in the area, encouraging local shopping and keeping money in the Drogheda area.

Drogheda BID identified the gift card project as having the most potential impact for businesses affected by pandemic related restrictions. The Love Drogheda Gift Card will be provided by Scottish fintech Miconex through its Town and City Gift Cards programme.

“Every half a million euros spent through the programme in Drogheda could support 15 jobs in the town,” said Trevor Connolly, chief executive officer at Drogheda BID. Key to the strategic introduction of the programme is corporate sales:

“In a gift card programme, there is the potential for up to 80% of sales to come through corporate gift giving. In Ireland, we benefit from the small benefit scheme whereby you can give employees up to €500 tax free each year. A lot of Christmas parties won’t be able to go ahead this year. What we hope businesses in Drogheda will do instead is reward employees with the Love Drogheda gift card. My approach would be to research likely employers, contact the CFO and set up a face to face meeting so you can answer questions there and then.”

The UK trivial benefits scheme allows businesses to give an employee a benefit of up to £50 without paying tax, as long as it isn’t in cash. The Gift Card & Voucher Association has launched a campaign calling for the UK government to increase the tax free gifting allowance from £50 to £500, bringing it in line with the Irish scheme.

In the west of Ireland, Ballinrobe Community Development Council (CDC) and Ballinrobe Enterprise Organisation (BEO) will launch their Lake District Gift Card in November. A joint initiative between Ballinrobe and neighbouring towns, the Lake District Gift Card can be redeemed with over 60 businesses in Ballinrobe and surrounding areas.

Ballinrobe CDC and BEO have been working with employers in the area on the launch of the card, and also plan to promote it to Ballinrobe diaspora living overseas, said Richard Burke, Chairperson of BEO:

“When we were looking to introduce a gift card, one of the first steps was to talk to the major employers in the area. It was key for us that they would support the gift card programme by using it for staff rewards and incentives. By talking to employers in this early stage, they helped us to see the benefit of extending the card out to neighbouring villages, because employees might live in one village but travel to work in another.”

“Having the wider choice of places to spend the card made it more attractive to employers and employees,” said Chairperson of Ballinrobe CDC Pat Donnellan: “With major companies on board with the project, we pressed ahead with the Lake District Gift Card. As a small town, we have to be proactive about finding solutions to help ourselves. Employers, employees and residents all have a responsibility to support our area.”

The Town and City Gift Cards programme received the award for best use of prepaid at the Incentive Awards in 2020. The Town and City Gift Cards programmes have been expanding rapidly across the UK and Ireland in 2020 and over 50 places now have active programmes.

Watford in Hertfordshire introduced its Watford Gift Card in February 2020, and have had success in attracting corporate orders for their gift card. Glen Hempenstall, Watford Business Improvement District’s marketing and communications manager said the Watford Gift Card was a way for employers to show their support for their employees, and the local area too:

“Our biggest order was from Watford Council for 240 gift cards at £20 each, a £4800 order for us. This wasn’t actually Christmas related but as a thank you to staff for their work during the pandemic. For an employer, there’s a dual benefit of rewarding staff with something they will appreciate and can spend in a variety of ways in Watford but there’s the business benefit of proactively supporting the town too.

“2020 has been a very difficult year for businesses. We heard that Watford Council were looking for a different way to support businesses, so we got in touch with the business liaison manager and suggested the Watford Gift Card to them. Instead of a £20 Amazon gift card with the money going out of the area, employees have a £20 Watford Gift Card and that money is locked into our local economy.”

In Leicester, the new Leicester Gift Card which launched in October has benefited from a large corporate order from a business wanting to thank employees for their work during the pandemic.

Colin Munro, managing director of Miconex believes many employers will be looking for new ways to reward staff in 2020:

“2020 has been one of the most challenging for businesses and for employees too, who have been asked to work in new ways and have often gone above and beyond to meet business needs. Footfall was down 31.1% overall in September, and 36.9% in high streets suggests BRC data. At the same time though, the shop local sentiment is growing. People are seeing the value of communities once more, and the desire to support their local town or city is strong. That employers are considering new ways of rewarding their staff feels right in what is an extremely unusual year.

“The Incentive Research Foundation found that 94% of executives support incentive programmes and gift card programmes are top of the employee incentive wish list. With local gift card programmes, employers can take a socially conscious approach to gifting that drives local economy recovery.”

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By Lisa Baker, Senior Editor

Senior Editor Lisa Baker is the owner of Need to See it Publishing Group, providing contract news for business and news sites across the UK. Lisa is an experienced HR writer and commentator, editing HR publications for more than 5 years.