Retailers Fail To Capitalize On Gift Cards As Digital Purchases Rise


Retailers Fail To Capitalize On Gift Cards As Digital Purchases Rise



by  @lauriesullivan, July 5, 2022

Retailers Fail To Capitalize On Gift Cards As Digital Purchases Rise


The majority of customer journeys to make a purchase begin online, and digital is the entry point to a growing number of retail experiences.


Still, most retailers have been slow to react to increased demand for digital gift cards and customer demand for enhanced experience, transparency and flexibility.


Incisiv, a digital insights company, released its 2022 Gift Card Program Index report sponsored by GiftNow, a Synchrony company, which evaluates 75 retailers that offer the most mature gift-card program experiences for shoppers.


The data analyzes insights from 60,000 shoppers spanning 2,500 global industries, and considers the impact of specific digital capabilities on performance metrics, such as conversion, average order value (AOV), churn and customer satisfaction scores (CSAT). Then it provides recommendations for retailers to improve digital gift card capabilities. 


The report finds that 80% of shoppers prefer some form of gift-card personalization, with 30% of shoppers willing to pay an additional $3 to personalize their gift cards. 


About 59% of employers prefer digital gift cards over other incentives to reward employees — indicating an opportunity for retailers to drive sales with corporate gifting programs. 


Digital gift card sales continue to rise, increasing by 25% year-over-year, according to data from the report.


For retailers, the change in consumer behavior has brought a new set of requirements, according to the study.


Belk, Best Buy, Ulta, and Williams Sonoma are included in the list of leaders.


Each are mature across most of the four areas analyzed such as research and discovery, ordering and fulfillment, purchase experience, and recipient experience.


Some 52% of customers say they select the retailer gift cards based on relevant promotions, but only 33% of retailers promote gift cards on their home page.


Only 12% of retailers offer gift-card delivery via SMS, while 7% offer a contribution to charities from gift-card sales and 16% offer the capability to add gift cards to their mobile wallet or account.


About 32% of shoppers cite suggestions from the retailer as an important factor for choosing the gift-card program.


In 2022, only 25% of retailers offer filtered search on their website for gift cards — up from none in 2021 — among the retailers analyzed for the study. Not surprising, department stores have the most mature gift card functions across research and discovery.


Providing reviews on gift cards increases transparency by allowing shoppers to read and provide experience feedback related to the product.


Some 93% of new shoppers actively seek reviews before they buy a product, but only 25% of retailers showcase reviews and ratings on gift-card product pages.


Home-improvement retailers have the most mature functional capabilities for gift-card ordering and delivery, offering more flexible delivery options and expedited fulfillment capabilities. 


Some 80% of shoppers prefer some form of gift-card personalization, with 30% of shoppers willing to pay an additional $3 to personalize their gift cards. 


Most shoppers prefer some form of gift card personalization, with 30% of shoppers willing to pay an additional $ 3 to personalize their gift cards, according to a report from Incisiv, a digital insights company.

 

 

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