Did mothers get what they wanted for Mother’s Day? A survey from CashStar, conducted by Harris Interactive, found Moms prefer personalized eGifts and gift cards over perfume and jewelry. “The way we think about gifting is changing, and this survey really drives home the growing demand for personalized eGifts,” said David Stone, CEO of CashStar.  “After Christmas, Mother’s Day is now the second biggest eGift holiday.”

Retailers like gift cards just as much as Moms. It is a source of new revenue and a way to increase brand exposure. Merchants, both small and large, can partner with digital gifting companies to manage the platform for one store or an entire chain.



Next Generation of eGifting – More Personalized 

E-gifting is a growing category that started about three years ago and attracted hundreds of merchant brands to digital platforms. Digital incentive and gifting experts found that consumers shopping online want more intuitive and immediate results and a personalized look to the card. 

A few months ago, CashStar, a digital gifting and incentives partner for retailers, introduced its innovative Web Gifting 2 platform. A new user interface makes the eGift experience more engaging, interactive and convenient for both the sender and the recipient.

“In our usability testing, we found out that people love eGifts,” said Stone. “We also found that thoughtful gifters, like Moms, want a high touch, warm product, so we added some enhancements.”

A number of smart merchants, such as Williams-Sonoma and Gap, are challenging program partners to create more personalized, digitally compelling gift cards.  Williams-Sonoma was an early adopter of digital gifting, as was Gap, and they worked with CashStar to create a more intuitive platform called Web Gifting 2.

“Electronic gift cards are part of the Williams-Sonoma strategy, and CashStar connects us with digitally-savvy customers in new ways,” said Katherine Rice, vice president of business development for Williams-Sonoma, Inc. “With Web Gifting 2, CashStar is personalizing the entire digital gifting process from purchase through delivery. “

Web Gifting 2 provides digital gifting personalization and delivery features from one single Web page, making eGifting easy and interactive online and on most mobile devices. Through new interactive features, consumers can personalize their digital gift cards with a custom message, video and photo, select the card denomination, and send it immediately or select a future day via the new Plan Ahead tool. Through the new interface, eGift cards unwrap right in front of a consumer through an animated display upon delivery or can be presented physically as an attractive printed foldable gift. 

“We call this our ‘unboxing solution.’ When the receiver opens the email, she gets a beautiful envelope and sees a gift card float out of it,” said Stone. “We believe that CashStar has not only recreated the personal gift giving experience online, but we have improved the entire process evoking an emotional connection via video and other channels.” 

One other thing that CashStar discovered was that 17 percent of people are sending eGifts to themselves that they can use as last minute gifts for others.  There is a foldable version of the e-Card in high resolution with pumped up pixels, ready to present on Mother’s Day or Father’s Day or on any occasion.  CashStar’s Mother’s Day survey found that Moms prefer personalized eGifts and gift cards over perfume and jewelry.



Plastic Gift Cards Compared to eGift Cards

During year-end holiday season, gift card sales start to heat up. According to Bank of America Merchant Services, 50 percent of gift cards are given to the intended recipient less than a week from the time of purchase.  The research suggests that people wait until the last few days to buy a gift and if a plastic gift card is the choice, it can take too long to obtain if buying online.

According to Giftango, a digital and mobile gifting technologies company, fulfillment of a gift card purchased from a retailer’s website generally takes three to five days from time of order to mailbox delivery. That time frame is often extended the week prior to Christmas. When retailers only offer consumers plastic gift cards from their website, gift cards tend to decline dramatically about two weeks before the gifting event. Giftango’s research suggests that the trend is reversed when instant digital delivery is presented as an option.

As documented in a Giftango white paper, the four strongest sales days for eGift Cards in December 2011 were the four days directly preceding the holiday, December 21-24. These four days comprised 26.89 percent of all digital eGift Card sales for December 2011 and 14.24 percent of total gift card sales for the month (eGift and plastic).

The conclusion is that for retailers who offer only plastic gift cards from their website, there is an enormous opportunity to increase sales throughout the year by adding the option of eGift Cards. 



Expanding from B2B to B2C

Randy Simonian and his brother in the Chicago area started out in the gift card incentive space with a platform for corporations wanting to incent their employees. Before the internet, the reward system was based on points and the employee would go to a catalog and choose a gift.  As gift cards grew in popularity, awardofchoice.com introduced new products, including a customized (branded) corporate “loaded” gift card to reward their employees and a generic corporate “loaded” gift card.

“A manager at McDonald’s, Waste Management, or Coca Cola might order 25 gift cards from Walmart or some other retailer,” said Simonian.  “Companies spend as much as $50 billion a year on gift cards. This year Americans will spend $110 billion on gift cards.”

Those numbers made the Simonians rethink their business strategy about the markets they wanted to reach. They took their engine of 500 gift card brands to test the consumer market. During one winter holiday season, they set up a kiosk in a local mall and were astounded by the numbers. 

“We looked at the buying patterns and saw eight to ten thousand shoppers send gift cards to 22 different states. It was like a spider web,” said Simonian. They decided to create a new division for consumers and called it arraygift.com, which creates customized gift cards for consumers.

“We now have two unique and exciting gift card programs. Our consumer product is arraygift.com and our business product is awardofchoice.com,” said Simonian. “In either case, when a consumer or employee receives one of our gift cards, they go to the appropriate website and can choose from over 500 of their favorite retailers’ gift cards.”

Both divisions tout value and dollar for dollar purchasing power, with no hidden fees and no expiration dates. Profit margins depend on volume and on the float. If the human resource department of a big company orders 100,000 gift cards, they get a discount.

Awardofchoice.com made another change to help businesses. If employers don’t want to have live cards sitting around, they can get codes or printed certificates to award employees.



What Retailers Should Go After

To start a gift card program, retailers should choose a technology provider that specializes in digital gifting and incentives. eGift cards should offer rich features that consumers want, which will help merchants create a new profit center with very little effort or expense.

Card commerce prepaid platforms should enable automated funds transfer, reconciliation, and a variety of reporting options, so merchants can track gift card sales and activity without extra bookkeeping effort. The platform should have a solution for receipt of receiving. That means you want to make sure the recipient got the gift card. This requires pinging them and re-pinging, if necessary. 

There is no limit to the way gift cards can be used as incentives and alternative currency. It’s time to get started on a rising trend. •