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5 mistakes to avoid in a gift card e-commerce program

Alex Barseghian, group VP, sales and marketing retail, Blackhawk Network, offers up the top five missteps retailers should avoid when crafting the gift card strategy.

Photo by istock.com

October 30, 2019

By Alex Barseghian, Group VP, Sales and Marketing Retail, Blackhawk Network

With around seven in 10 Americans now shopping online, chances are your business recognizes the need to make gift cards available beyond your in-store presence and across multiple channels — including online, mobile websites and apps.  A gift card e-commerce program can help you cater to online shoppers, expand your customer base, increase visibility, and boost revenue. However, there's much more to it than adding gift cards to your online shelves and hoping people will buy. Blind spots in how you run and manage your program may curb your efforts and, if left uncorrected, prevent you from getting the most out of your online gift card offering.

As you establish and manage your gift card e-commerce program, avoid these five mistakes that put off customers and dampen ROI.

#1 – Poor omnichannel discoverability

With consumers increasingly shopping across multiple channels, is your gift card selection easily discoverable across your website, mobile website and mobile app? Consumers don't want to have to search a website aimlessly to find them. Instead, prominently feature your gift cards on all your channels. Consider including dedicated gift card webpages in your website menus and gift cards on results pages. You can also take it one step further and explain to website or mobile app visitors the process of buying and sending a gift card, and the ease and convenience of doing so.

#2 – Forgetting mobile in the omnichannel experience

Despite a projected 62 percent annual increase in mobile payment transaction volume through 2021, according to Statista's Digital Market Outline, brands still lag in optimizing their gift card programs for mobile users. The 2018 Merchant Gift Card E-Commerce Evaluation report, which evaluates 100 top merchants, found that only eight of the 87 brands with a commerce app have mobile app purchase experiences that score equal to or better than their desktop experiences. If you take a look, many brands with a commerce-enabled app have not optimized their gift card programs for mobile users. Far too many brands are missing this opportunity to generate revenue from mobile shoppers.

#3 - Overlooking self-use trends

Consumers want to buy gift cards for themselves — not just for others. Blackhawk Network research found that a third of surveyed consumers bought a gift card in the last year for themselves.4 That's not all; while consumers spend on average $47.91 on gift cards for others, they spend $51.93 for self-use gift cards.  Given the increase in gift cards that are purchased for self-use, you'd be wise to try to streamline your egift purchase process. For example, give online shoppers the option to skip steps on the checkout page that are necessary only for gifting, such as adding recipient's information or personalized messaging. Consumers value a purchase process that is fast and easy. Layering promotions to your gift card promotions (think: buy $50 gift card online and get $10 gift card free!) is a great way to drive online purchase and self-use.

#4 - Limiting payment options

The more ways consumers have to pay for an item, including a gift card, the more likely they are to make a purchase. Having multiple ways to accept payment could put you at an advantage, so it would be wise to include easy payment options such as PayPal and Apple Pay at checkout. These create a more seamless and convenient experience and spare consumers from the tedious process of having to add all their payment and address information for each purchase. Not just that; Blackhawk research found that 76 percent of surveyed consumers said an easy payment process will make them more loyal to a brand.  

#5 - Missing out on online B2B programs

Demand for gift cards is high not just among consumers, but employees, too. A Blackhawk study found that 69 percent of surveyed employees would like to receive a gift card as a reward from an employer. However, many businesses miss the opportunity to sell gift cards to businesses in bulk for use in reward and recognition programs. According to the 2018 Merchant Gift Card E-Commerce Evaluation, 37 of the 100 merchants analyzed had no mention of a B2B gift card program on their website and only 38 of the merchants evaluated offered both physical and egifts to B2B buyers.3 Why miss out on this untapped revenue opportunity?

In today's fast-paced retail environment, stay on top of e-commerce trends and be quick and nimble in managing your gift card program to better serve consumers no matter where they are shopping. By avoiding these five common mistakes, you can better grow your gift card e-commerce program to connect with more consumers and ultimately boost your bottom line.