Stored Value 101

Making gift cards, promotions and merchandise credit an integrated part of your marketing strategy.

What is Stored Value?

For B2C businesses, stored value describes a situation where a business has received payment for goods or services that can be redeemed in the future. For example, when a customer buys a gift card from a retailer, the unredeemed amount represents stored value. The business is responsible for providing future value on redemption, which means that stored value represents a liability on financial reports.

However, stored value programs, executed strategically, represent an enormous opportunity for retailers to:

  • Gather customer data
  • Gain actionable insights
  • Improve brand recognition
  • Expand customer base
  • Increase revenue

Common stored value programs for retailers include gift cards, loyalty points, and merchandise credit.

What is a Stored Value Solution?

A stored value solution helps businesses manage stored value programs. Many stored value solutions are financially-focused: helping businesses to estimate the liability of outstanding stored value for accurate financial reporting and compliance.

Importance of Stored Value Solutions

Managing stored value is a critical function for B2C companies. Until recently, however, the focus has been on accurate financial reporting and regulatory compliance.


When an item (like a gift card) is purchased but not redeemed, it must be recorded as a liability on the company’s financial statement. Starbucks is a great example of a business with a robust stored value program. They issue gift cards, offer loyalty reward points, and have special offers and regular bonus programs to drive special offers and redemptions.

In 2021, Starbucks reported that 43% of its income came from stored value programs. But not all of that value was redeemed by consumers.


A prepaid option that is purchased but not redeemed is known as ‘breakage’. A recent survey found that 47% of American adults have at least one unredeemed gift card in their possession. And nearly one-third (29%) reported that they have retained an unspent gift card past its expiration date so that it was never redeemed.

For the purpose of financial reporting, a company can report estimated or actual breakage to reduce its liabilities. For Starbucks, in the above example, this accounted for $181 million in stored value that was purchased but not redeemed.

Typically, stored value solutions keep track of the dollar value of outstanding liabilities, allowing the finance and accounting team to generate accurate reports. In some cases, they track historical redemption value, to improve the accuracy of forecasted breakage.

But in an increasingly sophisticated and competitive retail environment, more and more businesses are looking to use stored value solutions to drive organizational strategy and goals.

What is a Strategic Stored Value Solution?

Strategic stored value solutions, instead of being financially focused, are business focused. These solutions do help companies manage the financial aspects of gift cards and other programs, but can also support larger strategies: including customer growth and retention, brand recognition, and increasing sales and revenues.

Strategic stored value solutions have capabilities that basic solutions do not. For example, a strategic stored value solution is equipped to:

Gather customer data

Every choice that your customers make provides valuable data that can be turned into actionable insights. This includes stored value programs. When customers purchase a gift card, this informs you about their buying habits. When they redeem it themselves, that’s further insight – and when they ‘gift’ it to another individual, that’s additional information that can be used to build accurate customer profiles.

Why not use it?

A strategic stored value program gathers data on customer activity that can be used to inform business decisions. For example, a segment of current customers may habitually purchase gift cards in December to use as holiday presents. Creating an offer on bulk gift card purchases, or a holiday-themed physical gift card may boost sales of gift cards to that segment of customers, increasing revenues.

Integrate with other applications

So valuable customer data is available: why keep it siloed in just one part of the organization? These insights can inform activities across the entire organization and help reach wider, strategic goals.

Accounting can use a stored value solution to keep accurate records on stored value liability and breakage estimates – but marketing can link gift cards to loyalty programs to drive membership or reach out to new customers with a ‘recommend a friend’ promotion. Accessing stored value can help sales when they reach out to customers and leads, or inform more engaging interactions with customer service agents.

Why keep it to yourself?

For example, a stored value solution that is integrated with a CDP can help build a 360-degree customer profile. This deeper understanding of the customer can be applied to improved segmentation, better-targeted offers, and growth of the customer base.

Automate processes

Analytics drive action in the form of data-driven decision-making. However, for a solution to be scalable, some automation capability is essential. A stored value solution that supports process automation lifts the administrative burden of gift card redemption reporting and offer management.

Why DIY?

Imagine that the data from a loyalty points program shows that customers in suburban areas use points to make high-value purchases on Fridays. You could go through and manually segment the customers in those geographic areas (suburban) that have accrued loyalty points and deliver a special offer for in-store purchases on Fridays. Or you could automate the process, deliver the offer to the right customers at the right time, and get real-time customer activity data to measure the success of the strategy.

Learn More: See how a broad selection of companies utilized Clutch solutions to build customer loyalty and improve data integrity.

Benefits of Strategic Stored Value Solutions

Increase revenue


Customers tend to use stored value to defray the cost of a purchase, rather than matching the purchase to the credits available. Essentially, they overspend their stored value. For example, the average customer will spend $61 on a purchase where a $10 gift card is applied, spending $51 more than the card is worth. And for a $500 gift card, the average customer will spend $106 more. In this way, gift cards drive larger sales and increase revenue.

Upselling & cross-selling

A company can use all collected customer data to inform upselling and cross-selling efforts. This includes stored value data. Knowing what is purchased, and when, allows a business to offer related items to boost sales. According to McKinsey, upselling and targeted category penetration increase sales by 20% and profits by 30%.

Customer Engagement

People like to receive gift cards, either physical or digital. A recent study found that 71% of consumers are more interested in digital gift cards versus other types of gifts. One way to look at gift card sales is that they engage two customers – the person who purchases the card, and the person that redeems the card.

Other stored value strategies, like loyalty programs, can boost customer engagement as well. One measure of engagement is the open rate and click-through rate of emails sent to customers. The average open rate across all industries is 17.92%, and CTR is 2.69%. In contrast, a marketing email that is sent to a loyalty program member has an average open rate of 45.80% (255% higher) and a CTR of 16.17% (600% higher than non-loyalty emails).

A complete stored value solution that meets all business requirements – from compliance to analytics and integrations – should be built on a platform flexible enough to meet a variety of current needs, and adaptive enough to support future needs. The Clutch Platform provides a comprehensive toolkit so businesses can maximize the impact of stored value solutions. The no-code, drag-and-drop interface, and pre-existing integrations with key e-commerce, marketing, and strategic partners make it easy to make the most of stored value.

Want to see it in action? In the video below, you can see how a Clutch Platform – Shopify integration allows e-commerce businesses to easily create 360-degree customer profiles using stored value data. Then contact us for a customized demonstration of how to put the Clutch platform to work for you!

Learn More: Watch a demo of our stored value solutions and talk to an expert today.