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Why Online Gifting Is Critical to Your eCommerce Success

Why Online Gifting Is Critical to Your eCommerce Success

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Online store owners face the daunting task of increasing conversions day by day. Despite the rapid growth in technology and sales, efficient marketing techniques are still limited.

If you ask any modern-day retailer about the methods they use to market their products, the usual suspects would be PPC (Pay-Per-Click), SEO (Search Engine Optimization), email marketing, content marketing, and whatnot.

One underrated eCommerce marketing technique with a lot of potential is the use of online gifting.

Yes, you read that absolutely right.

Allowing your customers to send and receive gift cards opens the domain of choice to them.

The main reason for the underuse of gift cards on eCommerce stores is the inability to use them effectively. Store owners aren’t sure how to leverage this promising marketing tool.

Throughout this article, I will be walking you through the different ways you could use online gifting in your store. This will help you improve your conversion rate.

Why you should pay attention to online gifting

Just look at these stats:

  • According to Retail Gift Card Association research, gift card sales are projected to reach $171.5 billion in 2019, up from $166.7 billion in 2018.
  • According to the 2018 Consumer Insights Study, consumers surveyed plan to spend over half their annual gifting budget on gift cards which translates to close to $400 per gift card purchaser annually. Additionally, 33% of consumers surveyed spend more on a gift card than a traditional gift.
  • The projected gift card sales in the United States from 2006 to 2018 (in billion U.S. dollars) is shown below:

Gift Card Sales for online gifting

Image Source

The above statistics are enough to prove the popularity and trend of online gift cards. The digital gifting industry has only seen an upward trend over the last several years.

Online stores which provide gift cards to their customers for different occasions and events have an edge over those who don’t.

Thus, if you own an online store and you aren’t offering gift cards yet, you are missing out on a big opportunity to increase sales and revenue.

Why e-gift cards?

Gift cards can be bought both digitally and physically. With the rise of eCommerce, sales of e-gift cards have seen an all-time high.

E-Gift Cards for Top 10 Amazon Products for online gifting

The above image is evident in the fact that online shoppers love gift cards. Amazon’s top product is their gift card which is loved by everyone and distributed almost everywhere possible.

We all understand that giving money as a gift to our loved ones is not as ideal as it lacks emotion. In such a situation, gift cards act as the savior. Moreover, gifting a gift card to someone enables them to buy the present of their choice.

When they can buy this present online with the utmost ease, people are elated and the purpose is achieved. Both the sender and the receiver are happy this way. The receiver by choosing the gifts they want and the sender by being assured that they have given the perfect gift.

During the holiday season, the demand for gift cards is at its peak. People are on the lookout for the most suitable presents to offer their family and friends.

What better present than a digital gift card?

Gift Card for online gifting

Image Source

Those peaks denote the holiday seasons when gift cards become the talk of the town.

With such a big market size and the enormous sales opportunity that e-gift cards possess, you should have gift cards available for your online store.

The benefits of a well-managed online gifting program

Using a gift card solution on our eCommerce store solves many problems. Before putting it into practice, we should go through the different ways a gift card can benefit your store.

A personalized gift for everyone

The freedom of choice coupled with high emotions and personalization make gift cards a top choice of people.

Talking about personalization, your customers can create custom gift cards for any occasion or event. Gift card solutions come with in-built templates for special occasions like birthdays, Christmas, Easter, etc. Your customers can create their own templates, set their own logo, an event image, or modify an in-built template accordingly.

Allowing customers on your store to create personalized custom gift cards for their loved ones is bound to create a buzz on your store and improve customer experience.

Increase traffic to your store

People like to shop at and recommend stores which make them happy and provide a great user experience.

When you sell gift cards on your online store, you give people a reason to talk about you and your store. When people talk about your brand and it is in a positive way, you get much-needed exposure.

Positive word of mouth and recommendations from people can take you a long way. More people will start stopping by your store.

Acquisition of new customers will become a lot easier and increased traffic will boost your chances for more conversions and revenue.

Increase brand awareness

The images, templates, logo, etc. on the gift card are a sign of your brand. When these gift cards are circulated, they stamp their mark on both the sender’s and receiver’s mind.

Imagine this. Someone sends your gift card to their loved ones who are totally unaware of your brand. After receiving the card, they come to know about you and your business. There are high chances that they might even visit your store. In fact, they may become your next loyal customers.

Gift cards are an ideal way to advertise your brand and enhance your brand exposure. eCommerce stores need to take advantage of this handy promotion technique and expand their reach.

A pool of rich marketing data

Nothing’s more valuable than data. People pay good money and time to get their hands on customer data.

Gift cards provide you with rich consumer data which you can use later to market effectively.

Now, you may be thinking, how?

The way people use gift cards and their spending habits reveal a lot about them.

If you know that a particular customer sends a gift card as an anniversary gift to their friend on a specific date, this information can be used wisely in the days to follow.

The use of gift cards tells us a lot about both the parties involved. Segregating audiences on the basis of demographics, purchase history, favorite products, etc. is a good step forward.

Once we have this invaluable data, we can use it to market our products better as we know our customer’s preferences. Email marketing, Google Ads, and Facebook Ads can be used to reach people with the right message.

Increased customer retention rate and Customer-Lifetime Value (CLTV)

Low customer retention rate and customer lifetime value are a business’s biggest woes. A business always tries to improve both of these metrics.

You should not be surprised when I tell you that a gift card system can help here as well.

What is customer retention rate?

Customer retention rate can be defined as the percentage of customers that a company has retained over a period of time.

What is Customer Lifetime Value (CLTV)?

Customer Lifetime Value can be defined as an approximate profit value that a company makes from any given customer.

With the help of online gifting, you compel your customers to keep coming back to your store and become more loyal towards you. The customer-buyer relationship is strengthened and some of your loyal customers even turn into brand advocates.

Both the customer retention rate and customer lifetime value improve due to gift card transactions on your store. The more gift cards you sell, the more popular you become.

People tend to develop a likeness for your store and spend money over the course of the whole business relationship.

Increased revenue

This one is a no-brainer. In fact, all of the aforementioned benefits point in one direction.

More and more sales for your business.

Gift cards are bound to increase revenue for your business. Anyone who buys/receives a gift card for your store will cash it in. During the holiday season, gift cards transactions are high and drive in a lot of sales.

Another thing is that when people buy gift cards, they will most probably spend much more than that.

According to Gift Card Granny, 65% of gift card holders spend an extra 38% beyond the value of the card.

Your online business needs a marketing tool as efficient as a gift card system to boost user engagement and convert loyal customers into brand evangelists.

How to implement a gift card system on your store

Depending on which eCommerce platform you use for your online store, there are different gift card solutions which you can put to work.

I have mentioned the top gift card solutions for the respective platforms below:

  • WooCommerce: WooCommerce Gift Cards by MakeWebBetter, Gift Card by Magenest, YITH
  • Shopify: ai Gift Cards, ShopKeeper Gift Cards
  • Magento: Magento 2 Gift Card by Amasty, Magento 2 Gift Card Extension by Mageplaza
  • BigCommerce: BigCommerce Gift Certificate by Viigii
  • PrestaShop: The Gift Card Module, Gift Card Module by FME Modules

If you are on WooCommerce, I recommend WooCommerce Gift Cards.

With a plethora of useful features, this plugin is very easy to use and cost-effective. One highlight feature is the option for a customizable gift card where you provide the customer with an image gallery. The customer can use any of the given images or upload their own custom image.

Customize your Gift Card for online gifting

As shown above, it is quite easy to select images and preview your template so you can create the best gift card template.

After finalizing which extension to use for your store, you just need to install it and you are good to go.

As promised, here are some proven online gifting strategies you can include in your marketing plan straight away:

Use the festive season to good effect

This really goes without saying in the case of gift cards that we need to leverage the holidays when shopping is at its peak. You can make a festive calendar marking important shopping dates so that you are well prepared for it.

Top 10 Customer Spending Events for online gifting

Image Source

Offer gift cards some days before these dates and let the traffic rush into your store.

Offer gift cards as a loyalty incentive

This is a great strategy to make your customers happy and boost your sales. Customers feel elated when they are recognized and valued. If you are sending out gift cards to your loyal customers on special occasions or as surprises, you kill two birds with one stone.

These customers increase your sales and revenue by spending more. Secondly, they pass on the positive word of mouth among family and friends to increase your new customer base. It’s a win-win situation.

Use multiple channels to reach your customers

In today’s fast-moving world, having multiple touchpoints to connect with your audience is indispensable.

The same applies to offering gift cards as well. Email marketing, social media, SMS, etc. should all be used to share gift cards and related offers. This will reduce the chance of you going unnoticed and will drive engagement.

Cross-sell items

This is another good strategy to use in sync with gift cards on your store. For those who don’t know yet, cross-selling is when you offer complementary or related items to the product in question.

The idea is to cross-sell gift cards along with your popular products. Like:

“Buy this product and get a $50 gift card free of cost”

With this approach, you are easily able to clear out your inventory and at the same time, give away gift cards.

Yes, again a win-win situation.

Discounted gift cards and in-store promotions

Whether you run a social media promotion or in-store contests, gift cards are appropriate rewards to be distributed.

Another way is to offer some concessions to gift card prices. Customers are attracted to such lucrative offers and tend to buy more and more.

Appealing gift card designs

Last but not least, the gift cards that you are giving out to your customers must be attractive. Some basic checks include the use of your brand logo, name, watermark, etc. so that they are self-promoting.

The more enticing your gift card design, the more tempted people will become to get their hands on one of them.


It’s clear that gift cards serve as an efficient marketing medium, helping us achieve better eCommerce sales. Given the scarcity of new ways to generate business revenue, an online gifting solution acts as a boon for brands all around the globe.

A gifting solution stresses on all important verticals like personalization, relationship-building, sharing experiences, and spreading the good word.

When online businesses have such a powerful marketing weapon as digital gifting at their disposal, it would be silly not to use it.

Guest author: Himanshu Rauthan is an entrepreneur, Co-Founder at MakeWebBetter, BotMyWork and the Director of CEDCOSS Technologies. He has worn many hats in his career – programmer, researcher, writer, and strategist. As a result, he has a unique ability to manage multi-disciplinary projects and to navigate complex challenges. He is passionate about building and scaling ecommerce development. Connect with him on Twitter or Linkedin.

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