Across the pond
Digital vs plastic gifting
With the rapid growth of digital gift cards delivered to email and smartphones, and the growing buzz around mobile wallets, some have asserted that plastic gift cards are becoming a trend of the past. While it is true that digital cards are gaining acceptance, both digital and plastic cards are thriving within the prepaid space and each offers a different set of benefits.
Plastic, tried and true
The vast majority of gift cards today are in the physical form. They are the predominant choice when the gift is being physically handed to the recipient. A plastic gift card, coupled with a greetings card is tangible and is viewed by some as more personal than the digital counterpart. Plastic gift cards are an established product in the marketplace.
Purchasing a physical gift card doesn’t generate measurable friction for a consumer when they are already in a distribution outlet of gift cards as they hunt for the perfect greeting card. The physical gift card has been a trusted and reliable product for a number of years and it continues to grow in popularity.
Digital and right in the nick of time
Digital gift card trends indicate that digital cards are most frequently leaned on during the last-minute purchase. Fast and convenient, digital gift cards allow customers to purchase a gift card and receive it within seconds, delivered via email or mobile phone. Digital gift cards also allow consumers to purchase and receive a gift card outside of normal business hours, which is a draw for busy consumers.
Reduced cost of production and the speed of fulfillment add to the allure for retailers. Many retailers now lean on digital cards as a mechanism for customer service resolution, promotions and loyalty programmes/rewards.
Trends in ecommerce gifting
Giftango helps a large variety of retailers sell both plastic and digital gift cards from the retailers’ own websites, putting Giftango in a unique position to provide data on gift card preferences. Looking at plastic vs digital gift card sales during the Christmas season, ecommerce sales of plastic and digital gift cards are about even for the first half of December.
As time for delivery of the card becomes a factor, the selection of digital gift cards surge. In fact, the busiest day of the year for digital gift card purchases is usually 24 December, just one day before Christmas Day!
On the horizon
Physical gift cards are the form factor of choice in today’s market. Digital gift cards are just beginning to scratch the surface. There are clear advantages to the digital format in certain environments, such as ecommerce sales. Businesses that offer both physical and digital gift cards are able to serve a wider consumer base by providing the benefits of both formats.
We expect to see savvy consumers start to lean more toward digital cards as they come to rely on features, such as instant balance check, easy storage on a mobile device and reload capabilities. However, we also expect to see digital and physical cards happily coexist for the foreseeable future.
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