Growing mobile wallet use drives significant gains for egift cards: report
Awareness of egift cards and the mobile wallets for storing them are on the rise, with 50 percent of consumers saying they know how to redeem an egift card, up from four percent last year, according to a new report from the Retail Gift Card Association. A First Data survey found that gifting has hit the mainstream, with 50 percent of consumers reporting they have purchased an egift card in the past year while 64 percent look to store gift cards on a single mobile device.
“While mobile and online usage of egifts is growing quickly, most shoppers do still prefer to give physical gift cards,” said Timm Walsh, chair of the board at the Retail Gift Card Association.
“However, it was interesting to find when consumers were most likely to select an egift over a physical gift card,” he said. “The top three instances were: when they need the gift to arrive right away, when they are buying for younger people who live a digital lifestyle and when they want to avoid holiday crowds – since the codes can be purchased online or via mobile.
“With these things in mind it’s fair to assume adoption of egift will continue to boom.”
The Retail Gift Card Association survey reveals a 27 percent increase in the number of consumers open to using mobile wallets, topping out at 54 percent. Additionally, a third of consumers are very comfortable using egift cards while only 29 percent have never used one.
Gift cards of all kinds continue to be an important gifting choice for shoppers. However, as mobile retail and mobile payments grow, this impacts the awareness and adoption of the digital version of this popular holiday option.
In the survey of 1,000 U.S. consumers, the Retail Gift Card Association found that 73 percent of consumers plan to give at least one gift card this holiday season.
Omnichannel services are important for gift cards, with 63 percent of shoppers liking the option of giving either physical gift cards or egifts while 71 percent said it was important that the recipient can use the card either online or in person. Additionally, 37 percent of gift card recipients are redeeming their gifts in-store, 15 percent online and 40 percent use a combination of both.
A separate report from First Data found that younger consumers are not the only ones interested in egift cards, reflecting the growth in mobile adoption.
The payment technology company’s annual Prepaid Consumer Insights survey found that 42 percent of those aged 54 and older have also purchased an egift card. In some instances, this group outpaces other generations, picking up more fast food and department store egift cards than other age ranges.
“Although there has been a measurable rise in the demand and awareness of egifts, retailers can’t put all their eggs in that basket alone,” Mr. Walsh said. “Omnichannel is key for consumers; they want to have the option of giving and redeeming these gifts in person, online and on mobile devices.
“Providing a seamless experience for shoppers to buy and redeem gift cards via a variety of avenues is extremely important,” he said.
Chantal Tode is senior editor on Mobile Commerce Daily, New York