Gift Cards Make Gifting Simple
With no doubts, gift cards became common ecommerce products, just like clothing and electronics, and are widely used by both small retailers and huge international businesses.
The reasons for this are obvious – customers like purchasing gift cards for their relatives, friends, colleagues, and other close people. The advantages of gift card products for businesses are also clear. Any gift card is able to:
- Increase brand awareness. In order to redeem gift cards, their recipients often visit your store for the first time. And if all the aspects of the shopping experience suite them well, they can become your regular customers.
- Get payments in advance. Gift cards generate early cash flows even before you start shipping items to end customers.
- Generate more sales. Quite often customers with gift codes are inclined to make purchases more expensive than the nominal value of the received cards. So, this way you can encourage higher average order values in your store.
Note: Consider that 65% of shoppers spend extra 38% above the nominal amounts of their gift cards, according to giftcardgranny.com.
Going deeper, there are two basic types of gift cards – physical and virtual. The last ones are primarily used in ecommerce, but online merchants may sell both or, even better, mix the above functions and distribute gift cards applicable across all the channels. Anyway, let’s dwell on the virtual type of gift cards, as it is primarily used by online retailers.