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gift card information in 2021

Everything you need to know about Gift Card in 2024

Gift Card History

Before diving into the Gift Card’s history, we need to know some information about its precursor: Gift Certificates. 

Gift certificates were first invented in the 1930s by department stores. Because they want to limit customers’ numbers, shopkeepers often hide gift certificates behind stalls and sell them only when requested.

gift certificate 1930

In the 1970s, after McDonald’s launched a Christmas gift certificate campaign for customers, it was then that gift certificates gained considerable popularity. Many stores and restaurants want to follow the trend to reach consumers’ needs and offer gift certificates to their own customers.

Unfortunately, gift certificates face too many problematic burdens: a time-consuming process of issuing and redeeming and can be counterfeited, leading to fraudulent activities, causing a loss of revenue to retailers.

blockbuster gift card

Neiman Marcus was the first to sell the cards, but they didn’t advertise and market them. Consequently, Blockbuster is officially considered the first company to display plastic to the public. It was the first to display in its stores because of rampant counterfeiting of its paper certificates. The next big gift card seller was Starbucks, which in 2001 introduced that worked more than once. In 2012, 1,500 Starbucks gift cards were purchased every minute in the U.S. and Canada. This coffee giant has sold 450 million cards worth $16 billion.

So, what really is Gift Cards, and why should stores take advantage of them. Let’s find out.

What is the Gift Card?

what iss gift card

A gift card is a prepaid debit card containing a specific amount, commonly used in other purchases

So, when do you really need a Gift Card? Imagine that you have to prepare an event gift for your loved one, such as a birthday or an anniversary. But you wonder what the person’s favorite color is, what the shoe size is, and more importantly if they really like the gift. For that reason, a Gift Card was created; you need to give it to relatives and freely choose what they really need within a certain budget.

How a Gift Card works

gift card work

Gift cards are a form of prepaid debit cards loaded with funds for future use. There are generally two types of gift cards: open loop and closed loop cards. Both types can typically be used online and in person.

  • Open Loop: Open-loop gift cards can be redeemed almost anywhere because they run on various credit card systems. Visa, for example, can be redeemed in stores, online, or via telephone, wherever Visa is accepted. They typically require payment of an activation fee because that is where the companies (plus bank and processor) makes money
  • Closed Loop: Closed-loop gift cards are only processed (activated, redeemed, supported) at the locations of sale listed on the card. For example, Amazon is “closed” because they can only be redeemed at their respective Amazon stores. Sometimes Closed- loop can also be processed in group owned by the same parent company

Many gift cards will have a minimum and maximum initial loading amount. A common minimum is $10, and a common maximum is $500. In some situations, they can be used to pay for a portion of the purchase with cash, debit, or credit used to balance the expense. As a precaution to mitigate the risk of losses, many gift cards can also be registered online—a procedure that allows the remaining balance to be tracked and frozen if a card is lost. In this way, some gift cards are safer than cash.

What are the benefits of Gift Cards in e-commerce business/website?

1. Increase your Sales and Revenue

increase sale and revenue

The most effective benefit that eCommerce gift cards bring is to boost sales. Especially during the holiday seasons, they become the most requested gift.

Finding the right gift for relatives can become a pressure that everyone faces. Therefore, eCommerce gift cards are considered the final choice that customers want to target.

eCommerce gift cards are often used to reduce prices when buying products with a slightly larger value, so you don’t have to spend too much money on the products you want. So cardholders often increase spending more than the amount in their account; this also increases revenue for the store. According to the statistics of Granny, up to 72% of customers spend more than the amount on their gift when buying products.

2. Boost Brand Awareness

brand awarness

Another benefit of eCommerce gift cards is Brand Awareness. The chances are that some of the recipients may not have heard of your brand yet. And they could get them from their friends and relatives after experiencing the product and receiving or purchasing a gift from promotions.

For that reason, eCommerce gift cards increase brand awareness and give users more insight into your brand. The brand identities are also the part that attracts and creates curiosity for customers, and the convenience allows them to reach any individual globally.

3. Digital Gift Cards are Convenient and Secure

digital gift card

The special feature of eCommerce gift cards is their security and insurance. For conventional ones that can be dropped or stolen, eCommerce gift cards are much more convenient and remove every situation you don’t expect. You can keep them without any trouble and keep your money safe.

4. Gain Customer Loyalty

gain customer loyalty

The interesting point is that they help you earn customer loyalty. It’s essential to keep customers engaged with your brand for as long as possible. And you can earn that loyalty only when you are able to keep them happy and satisfied.

Those who do not find a satisfactory experience with your product or want to process a return or refund. Gift cards are the solution for you; they can solve problems and help you retain customers, improve customer retention.

Gift Card Trend

As reported by the blackhawknetwork for the 13th consecutive year, gift cards remain the most popular items on wish lists. Stores need to consider gift cards as a potential feature if they want to reach the needs of consumers quickly. The survey of 7,782 adult consumers was conducted October 1-10 and had a margin of error of plus or minus 1.2 percentage points.

shoppers'wish lists

Who Buys Gift Cards? 

consumers survey

Also, according to the data that blackhawknetwork given above, most customers want Gift Card to really do their job. It not only meets individual needs but also serves as a meaningful gift for relatives. This is also essential to consider it as part of the marketing campaign for your brand. Please see the following figures to see how it is really impacting the level of business efficiency through technology.

interest in digital gift card

More than half of the consumers surveyed report interest in giving digital gift cards that can be added to a mobile app or digital wallet, especially millennials (69 percent) and smart phone users (59 percent), who are nearly three times more likely to be interested than those without a smartphone (17 percent).

From the above data, we can see the potential that Gift Card brings; with many customers wanting to give their relatives a gift during the holiday, this is an opportunity for businesses to increase profits.

Not only for normal ones but also eCommerce Gift Card types is also an indispensable product. Online strategies aim at targeting young people when convenience and speed are on top priority. As shown in the figure below, not only regular stores but also e-commerce platforms can take advantage of this opportunity.

Interest in digital options continues to grow

The research found that although the surveyed consumers currently purchase more physical gift cards than digital ones, online purchases are poised for continued growth.

Common Website can be mentioned as

  • Crutchfield Electronics or Apple
  • iTunes or Google Play
  • Barnes & Noble

Here are 5 Gift cards are considered popular today. They are built and perfected to reach customers in the best way. So if the small stores or you want to do business in the eCommerce market, what should you do?

To answer that question, on the market today, many e-commerce platforms offer Gift Card modules such as:

  • Magento
  • Shopify
  • BigCommerce
  • WooCommerce

And the special thing here, these platforms allow users to customize and meet the requirements to serve the campaign of their business. In this article, we will talk in a general way; each platform’s details will be listed in the following articles. Below will show you why Ecommerce Gift Card is the optimal choice in the present time.

How to use Gift Cards to grow sales?

1. Helps increase the revenue of online businesses.

Gift cards generate sales twice. Once they can buy what they want, then there will be a second customer approaching. If your website manages to create the right first impression, people actually end up buying more than the value that card offers.

2. Helps drive more traffic to your website

As we discussed above, eCommerce gift cards help increase customer awareness which means that we can also incorporate the right marketing strategy can help drive more traffic—any other source. With gift cards becoming more and more popular, you have to make a few attempts to deliver the message you are delivering. And in an instant, you will see a spike in traffic. Both the buyer and the recipient must pay access to your online marketplace.

Social media channels such as Facebook, Twitter, Instagram, etc., are a goldmine for you to mine through email marketing and targeted advertising to promote on e-commerce stores. Above all, make sure to hit the right chords through your website and customer experience.

social media trend

3. They ensure bringing in new customers

customer statics

Gift cards can expose your business to people who may not have otherwise shopped in your store. Customers who already know and love your business will purchase gift cards for friends, helping to grow your customer base.

You can also give gift cards when you’re asked to donate to a local fundraising event. By providing this instead of a product or service, you open the door for the recipient to use their prize and perhaps spend extra money in the process. Providing fundraisers also boost your brand recognition and creates a reputation for being a business owner who supports their community.

How to promote your e-commerce business?

1. Leverage e-mail marketing list

e-mail marketing

Begin building an e-mail list from the starting days of your business. This list can prove to be instrumental in marketing your gift cards. A holiday-themed mail sent out to the entire list, announcements will ensure improved traffic ahead and during the holiday sale season.

2. Deploy social media channels for promotions

social media channels

Utilize social media channels for effectively promoting your gift cards both prior to and during the sale season. It’s crucial to find out the channels where your target customers are most active and make efforts to attract them there.

3. Announce on your website

announce on your website

Make it a point to inform your customers of the availability on your website as well. The announcement needs to be done in a way to attract the maximum attention of website visitors. A well-placed banner and a carefully timed pop-up can convey the message in a moment.


Through the above article, you can see the importance of a Gift Card to your business. It can be seen that not only appear in regular stores but also an advantage that e-commerce sites cannot ignore. In this article, we hope you have a good overview. To help you understand more, we will have a series about each e-commerce platform that offers this module in the coming time. What Beehexa wants is to help your store gain more advantages in this digital transformation race.

If you need any further information about live chat or related issues, feel free to contact us!

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