How to Win at Gift Cards in the Age of Mobile and Social

November 17, 2016

Among holiday gifting strategies, gift card promotion is a no-brainer. But with consumers’ expectations rising for mobile commerce, social media, and online/offline shopping experiences, merchants must refresh their gift card offerings to stay relevant.  

Fully two-thirds of U.S. consumers received gift cards during the 2015 holiday season, and gift cards remain among the top-requested gifts, with close to 60% of consumers in 2015 saying they wanted to receive them. Given this popularity, catering to the needs of gift card buyers is a long-established best practice, with merchants dutifully spotlighting options in online holiday gift guides and through email campaigns.

But recent research suggests that gift card offerings and promotions are due for a refresh, especially when it comes to online-only digital gift cards, the fastest-growing type of gift card, with sales jumping 26% in 2015 to $7.1 billion. The need is acute for flexibility for both purchasers and recipients of digital gift cards, given that they can potentially be bought, received, and redeemed across touchpoints.

Even for the one in five merchants who don’t yet offer digital gift cards, planning for how to accommodate gift card buyers and recipients wherever they choose to engage is a valuable exercise, one that sets the stage for future success in whatever format gift cards are offered. Among the new best practices to adopt:

Go Mobile-First
Given that the majority of interactions with retail brands now occur over mobile device and the majority of emails are read first on mobile screens, it may seem like a no-brainer that gift card promotion, purchase and redemption should be mobile-optimized — but a surprising number of merchants still fail to do so. To rectify the situation, merchants should:

  • Make gifting options and selections legible on small screens. Too often, huge blocks of text outline purchase and redemption options — an overwhelming hurdle for mobile users. Merchants should use icons, headings, and accordion-style drop-downs to make the gift card product page navigable on any device.
  • Streamline the purchase process. Alternative payments are only the beginning. For gift cards, merchants should pull out the stops and road-test ways to add to cart directly from index pages, search results, home page promotional slots, and even social media outposts. Customizing the purchase path for digital gift cards to eliminate pickup or shipping options can further smooth the process and drive sales.

Make Options Crystal Clear
While merchants must make gift card product descriptions concise, they must also be clear — for both buyers and recipients. There’s still time in advance of the holidays to thoroughly vet the process from both ends and clarify:

  • With what payment methods cards may be purchased
  • In what format they can be delivered — physical, digital, or a hybrid of the two (such as a printable gift certificate delivered by email)
  • Where they can be delivered — can physical cards be ordered online and picked up in stores? Can digital gift cards be delivered through social media or SMS?
  • Where they can be redeemed — can physical cards be redeemed online, and digital cards in stores?

Enable Personalization
Giving a gift card may be a crowd-pleaser, but it’s also potentially a generic experience, which is perhaps why more than three quarters of gift card buyers say they seek out ways to personalize their purchase. Whether by automatically giving shoppers the option to include a personal message with physical gift cards or by enabling whiz-bang functions such as video messages with digital gift cards, merchants should give shoppers as many options as possible to make the recipient’s experience unique.

Go Beyond “Last Minute” Promotions
Merchants have long ramped up gift card promotion as shipping cutoff dates narrow shoppers’ options, on the premise that gift card buyers are primarily last-minute shoppers. But in fact, just five percent of purchasers said they bought gift cards because they ran out of time — suggesting that merchants would do well to broaden the variety of promotional angles they employ to boost gift card sales. In addition to promoting gift cards as the safest option for buying a gift that fits, merchants should:  

  • Incorporate gift card messaging into triggered email alerts such as abandoned cart reminders
  • Tout the flexibility gift cards offer, such as personalization, or novel delivery methods such as through mobile or social media
  • Consider gift card-related promotions for early-season dates such as Black Friday and Cyber Monday

Plan Now for Future Flexibility
If the present is any indication, merchants will need to be ever more flexible when it comes to gift card promotion and options as mobile shopping and buying becomes more prevalent and physical locations continue their transformation into digital stores. Among the gift card capabilities merchants should plan for now:

  • Multi-card, multi-recipient purchases. Enabling shoppers to buy several cards and direct them to multiple recipients both online and offline is not only a way to offer gift buyers the means to dispatch their recipient lists with one fell swoop; it’s also a means to court the burgeoning B2B market by offering corporate customers the means to buy cards in bulk for their own customers or employees.
  • Cards that combine with digital payments, coupons, and loyalty programs. Incorporating gift card credits into digital wallets or apps that streamline payment is crucial to their future utility.
  • Cards that can be combined and re-filled. As a first step toward integrating with digital wallets, merchants should enable combining gift card amounts online so they can be applied toward major purchases, and allow recipients and their friends to re-fill cards.
  • Cards as purchase incentive. Offering gift cards with purchase is already a popular promotion, and merchants should expand the concept to use gift cards as rewards for loyalty, referral, purchase of recurring subscription services, and other actions that promote long-term growth.

How are you using gift cards to accommodate the needs of omnichannel shoppers?