With the holiday season fast approaching, retailers can strengthen their gift card offerings by incorporating e-gift elements, according to new research from shopper marketing firm Blackhawk Network.
A survey of 2,000 U.S. consumers to ascertain their use of physical gift cards and attitudes towards e-gifts found that, while gift cards remain a popular gifting choice, e-gifts, which are virtual cards delivered to recipients via email, text message or social media, are becoming increasingly popular.
“Our shopper data confirms that mobile and digital acceptance has extended to gift cards,” said Teri Llach, chief marketing officer for Blackhawk Network. “Consumers are increasing their overall purchase of gift cards because they now have more control over the format for delivery and the speed of purchase, plus a wide selection of gift cards and e-gifts.”
The key drivers of e-gift purchases among consumers are their fast electronic delivery (51%), ease of purchase (41%) and not having to send a physical gift (35%). Of the physical gift card buyers surveyed, 53% also purchased an e-gift in the last 12 months and 94% purchased more or the same amount of e-gifts in the last 12 months, compared to the previous year.
One of the key attractions to e-gifts is that redemption can be done in multiple ways – online, via mobile or in-store. Most e-gift recipients (69%) redeem e-gifts online but a significant number (46%) do so in-store. As with physical gift cards, many (82%) of e-gift recipients spend more than the value of the gift, with 76% prompted to use their e-gift by promotions.
Interest in e-gifts is significant. Of those who had never received an e-gift, more than half (56%) would be interested in getting one. Furthermore, the reason shoppers who had never purchased an e-gift had not done so was because they were not aware of the option.
Roughly two billion gift cards were purchased last year in the U.S., according consulting firm A.T. Kearney. The National Retail Federation says gift cards have been the most-requested gift for 8 years in a row. E-gift cards currently make up 5% of the market but, by 2017, that is expected to double.