With print-at-home coupons and airline tickets growing in popularity, CashStar Inc. has started allowing consumers to print customized gift cards purchased from retailers' Web sites.
For the concept to take off, CashStar will have to find a major retailer willing to experiment with paper gift cards and prove that its product works as promised, an analyst said.
"If they can do that, it has the potential to change the market," said Daniel Horne, associate professor of marketing at Providence College in Rhode Island.
Uno Chicago Grill, Travelocity Incentives and Gorham Bike & Ski started using CashStar's system last year. David Stone, CashStar's chief executive officer, said one of his goals is to sign up more large retailers and restaurants over the next 12 months.
Consumers can buy an electronic gift card at participating retailers' Web sites. CashStar's system lets consumers customize the gift cards with personal messages and pictures and then print them, Stone said.
"You're allowing a personal interaction between the purchaser and the recipient that you don't get with plastic cards," he said.
CashStar is using Coupon.com's bar code technology for its gift cards. Cashiers scan the bar codes at the point of sale.
Brian Riley, the research director of bank cards at TowerGroup, an independent research unit of MasterCard Inc., said CashStar's system requires consumers to change their conception of gift cards.
"Quite often, gift cards are impulse items consumers like to buy when they visit a store," Riley said.
CashStar, of Portland, Maine, also faces challenges from other third-party providers of prepaid gift cards, such as Safeway Inc.'s Blackhawk Network unit and InComm Inc., which have brought gift cards closer to consumers through display racks at supermarkets, Horne said.
Consumers are bombarded with so many options at the checkout lane, he said, it leads them think, "This is a gift I'm going to give."
CashStar also lets people e-mail custom gift cards as gifts. It plans to add more options to its system, including retailer incentives and loyalty rewards.