September 4, 2019
Gift card ecommerce has become one of the most intriguing areas of modern retail. The space is bursting at the seams with untapped potential but still misunderstood by many of the world’s largest brands.
The National Retail Federation (NRF) estimates that gifting drives at least 20 percent of today’s retail sales. The number can be as high as 25 percent according to some researchers. One in every four retail purchases in 2018, then, will likely fall under the gift category.
Selling gift cards online offers a plethora of “low-hanging fruit” for retailers who want to increase revenue, but today’s merchants are capturing only a fraction. The greatest obstacle is the fact that most retailers still treat gift cards as a niche category of their overall businesses.
In truth, gift card programs should be fully integrated into any ecommerce enterprise and expertly implemented across all operational channels. In this blog, we will outline the most important trends in selling gift cards online and highlight the three best practices that will help brands claim these missed opportunities.
The above trends are critical adaptations which merchants need to stay competitive in gifting ecommerce. The “how” is outlined below in the best practices that merchants need to succeed.
Provide an omnichannel customer experience: One of the most provocative revelations from the NAPCO 2017 “Merchant Gift Card Ecommerce Evaluation” was the fact that only 36 percent of the brands evaluated sell gift cards online. This finding supports the assertion that there is a misperception among brands that gifting is a niche business.
Providing omnichannel opportunities for gift cards is imperative to increase revenue today. Merchants should ensure that customers will have the same optimal experience in searching for and purchasing gift cards from their desktop devices, on mobile devices, in mobile applications and in-store.
Engage in conversational commerce: The best bet for merchants is to bring commerce opportunities to customers’ preferred channels. As the new “digital watering hole,” social media apps are an ideal channel. These messaging apps have risen in popularity, making them the perfect intersection of customer conversation and shopping. Through chatbots and other technologies, brands can connect to, engage with and delight customers through conversational commerce experiences. The key is in providing a streamlined, tailored experience for customers, which requires intuitive design.
Conversational commerce allows customers to make one decision quickly through simple, intuitive and streamlined messaging. In 2018, merchants using our newly optimized conversational UI have experienced, on average, a 40-percent faster purchase time.
Ensure complete accessibility: Gift cards must be easy to find, easy to purchase and easy to use across all retail channels and media. They shouldn’t be hard to locate on a website or impossible to access through a mobile app. Nor should they take weeks to arrive in the regular mail, as was the case with some of the brands included in NAPCO’s evaluation.
Gift cards are a powerful tool for retailers to increase revenue. Brands that invest in expert implementation across all retail channels—and follow best practices—are positioned to unlock the full potential value that selling gift cards online can provide. Understanding dynamic consumer preferences and behavior around self-use, personalization, everyday gifting opportunities, promotions, and mobile is integral to running a successful gift card program. Merchants stand to benefit greatly by finding the right partners and develop robust, omnichannel gift card ecommerce programs.